Did Right-To-Work Laws Impact Income Inequality? Evidence from U.S. States Using the Synthetic Control Method uri icon

abstract

  • In this paper, we use the Synthetic Control Method (SCM) to examine the impact of a state's adoption of a Right-To-Work (RTW) law on income inequality. We explore possible pathways through which RTW laws may impact inequality, namely, unionization, investment, and wages. Our finding of a lack of impact of RTW laws on inequality is further supported by findings of a lack of impact of the law on these variables. Our results follow Farber (1984), who suggests that RTW laws may simply mirror pre-existing preferences against union representation. Hence RTW laws are not the primary driver of changes in inequality.

publication date

  • 2021
  • 2020