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Impacts of Unionization on Employment, Product Quality and Productivity: Regression Discontinuity Evidence From Nursing Homes

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  • Aaron J. Sojourner
  • Robert J. Town
  • David C. Grabowski
  • Michelle M. Chen

Abstract

This paper studies the effects of unions in private-sector nursing homes on a broad range of labor, firm, and consumer outcomes. We link national data on nursing home characteristics from the Centers for Medicare and Medicaid Services to records on establishment-level unionization from federal labor agencies, and employ a regression discontinuity design to identify union effects by contrasting outcomes in nursing homes where unions closely won representation elections to outcomes in facilities where unions closely lost such elections. After showing that these two sets of homes are similar leading up to the election, we estimate union effects on staffing levels, care quality, and other outcomes. We find negative effects of unions on staffing levels and no decline in care quality, suggesting positive productivity effects. Consistent with these results, supplementary analysis shows significant increases in wages for some classes of nursing labor. Some evidence suggests that nursing homes in local product markets that were less competitive and had lower union density at the time of election experienced stronger union employment effects. We find no impact of unionization on facility survival. By combining credible identification of union effects, a comprehensive set of outcomes over time with measures of market-level characteristics, this study generates some of the best evidence available on many controversial questions in the economics of unions. Furthermore, it generates evidence from the service sector, which has grown in importance and where evidence on these questions has been thin.

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Bibliographic Info

Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 17733.

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Date of creation: Jan 2012
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Handle: RePEc:nbr:nberwo:17733

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References

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  1. Stewart, Mark B, 1990. "Union Wage Differentials, Product Market Influences and the Division of Rents," Economic Journal, Royal Economic Society, vol. 100(403), pages 1122-37, December.
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Cited by:
  1. Hart, Cassandra M. D. & Sojourner, Aaron J., 2014. "Unionization and Productivity: Evidence from Charter Schools," IZA Discussion Papers 7887, Institute for the Study of Labor (IZA).

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