Investment and union certification
A growing body of work--both theoretical and empirical--has emphasized that unionization may be better understood as a tax on capital rather than a tax on labor. Under this "new" view, unionization unambiguously lowers investment. Using data on union certification elections, we estimate the impact of unionization on firms' investment behavior. Employing both a standard q-model and an "investment surprises" technique, we find that union certification significantly reduces investment. We find that a winning certification election has, on average, about the same effect on investment as would a 30 percentage point increase in the corporate tax.
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- Voos, Paula B & Mishel, Lawrence R, 1986. "The Union Impact on Profits in the Supermarket Industry," The Review of Economics and Statistics, MIT Press, vol. 68(3), pages 513-17, August.
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"Unions And Investment In British Industry,"
Economics Series Working Papers
9992, University of Oxford, Department of Economics.
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31, California Los Angeles - Applied Econometrics.
- Rose, Nancy L, 1987. "Labor Rent Sharing and Regulation: Evidence from the Trucking Industry," Journal of Political Economy, University of Chicago Press, vol. 95(6), pages 1146-78, December.
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- Michael A. Salinger, 1984. "Tobin's q, Unionization, and the Concentration-Profits Relationship," RAND Journal of Economics, The RAND Corporation, vol. 15(2), pages 159-170, Summer.
- Jason G. Cummins & Kevin A. Hassett & R. Glenn Hubbard, 1994. "A Reconsideration of Investment Behavior Using Tax Reforms as Natural Experiments," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 25(2), pages 1-74.
- Bronars, Stephen G & Deere, Donald R, 1993. "Union Organizing Activity, Firm Growth, and the Business Cycle," American Economic Review, American Economic Association, vol. 83(1), pages 203-20, March.
- Harry G. Johnson & Peter Mieszkowski, 1970. "The Effects of Unionization on the Distribution of Income: A General Equilibrium Approach," The Quarterly Journal of Economics, Oxford University Press, vol. 84(4), pages 539-561.
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