Tuesday, February 4, 2020

Do Right-to-Work Laws Work?

By Jonathan H. Adler - February 04, 2020 at 09:19AM

During my morning commute I used to pass an anti-"right to work" billboard. The specifics would vary, but the message was always the same: Right-to-work laws are bad. One message was the proposed "Workplace Freedom Act" was a "cancer" on the working class, another featured a hammer and sickle.

Right-to-work laws may well be bad for union leadership, but are they bad for unionized workers? A recent paper in the Journal of Law and Economics by Christos Andreas Makridis of MIT suggests not. Here's the abstract:

This paper investigates the effects of state right-to-work (RTW) laws on individuals' well-being and economic sentiment. Using licensed microdata from Gallup between 2008 and 2017, this paper finds that the adoption of RTW laws is associated with a .029 SD and a .041 SD increase in individuals' life satisfaction and economic sentiment, respectively. A difference-in-differences estimator suggests that these improvements are concentrated among union workers. These results are robust to entropy balancing and border-pair approaches. Moreover, these improvements in well-being are consistent with an increase in competition among unions, which prompts them to provide higher-quality services that are valued by their members.

Interesting stuff to be sure.

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