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Did right-to-work laws impact income inequality? Evidence from US states using the Synthetic Control Method

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Listed:
  • Aparna Mathur

    (American Enterprise Institute)

  • Jeffrey L. Jordan

    (American Enterprise Institute)

  • Abdul Munasib
  • Devesh Roy

Abstract

There is an ongoing debate about the effect of changes in labor regulations such as Right-to-Work (RTW) laws on rising income inequality in the U.S. In this paper, we use a relatively new methodology, the Synthetic Control Method – which we argue is more suitable for analyzing this data – to examine the impact of a state’s adoption of an RTW law on income inequality. We use a wide range of inequality measures for states that enacted their RTW laws between the 1960s and the 2000s. Unlike some earlier papers that suggest a negative link between the RTW laws and correlates of inequality such as wages, we find that RTW laws had no significant impact on income inequality in these states.

Suggested Citation

  • Aparna Mathur & Jeffrey L. Jordan & Abdul Munasib & Devesh Roy, 2016. "Did right-to-work laws impact income inequality? Evidence from US states using the Synthetic Control Method," AEI Economics Working Papers 878380, American Enterprise Institute.
    • Handle: RePEc:aei:rpaper:878380
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    Keywords

    Income inequality; collective bargaining;

    JEL classification:

    • A - General Economics and Teaching

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