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Right-to-Work Laws and State-Level Economic Outcomes: Evidence from the Case Studies of Idaho and Oklahoma Using Synthetic Control Method


  • Ozkan Eren

    () (Department of Economics, University of Nevada, Las Vegas)

  • I. Serkan Ozbeklik

    () (Robert Day School of Economics and Finance, Claremont McKenna College and University of Maryland, College Park)


The role of right-to-work laws on state economies, labor organizations and employees are controversial and important policy questions. Empirical evidence is far from being conclusive predominantly due to identification issues. Using a recently developed econometric technique and exploiting the two most recent cases, -Idaho and Oklahoma- we examine the effectiveness of right-to-work laws on state-level outcomes. Our results indicate that the passage of right-to-work laws in Oklahoma affected union membership and coverage rates and, possibly to some extent, foreign direct investment. As for manufacturing employment, per capita income and average wage rates, we do not observe any impact. Our findings for Idaho, on the other hand, suggest that the laws increased the manufacturing employment, while it had no effect on per capita income and are inconclusive for foreign direct investment..

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  • Ozkan Eren & I. Serkan Ozbeklik, 2011. "Right-to-Work Laws and State-Level Economic Outcomes: Evidence from the Case Studies of Idaho and Oklahoma Using Synthetic Control Method," Working Papers 1101 Classification-JEL J, University of Nevada, Las Vegas , Department of Economics.
  • Handle: RePEc:nlv:wpaper:1101

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    References listed on IDEAS

    1. John A. List & Daniel L. Millimet & Per G. Fredriksson & W. Warren McHone, 2003. "Effects of Environmental Regulations on Manufacturing Plant Births: Evidence from a Propensity Score Matching Estimator," The Review of Economics and Statistics, MIT Press, vol. 85(4), pages 944-952, November.
    2. Alberto Abadie & Javier Gardeazabal, 2003. "The Economic Costs of Conflict: A Case Study of the Basque Country," American Economic Review, American Economic Association, vol. 93(1), pages 113-132, March.
    3. Wolfgang Keller & Arik Levinson, 2002. "Pollution Abatement Costs and Foreign Direct Investment Inflows to U.S. States," The Review of Economics and Statistics, MIT Press, vol. 84(4), pages 691-703, November.
    4. Thomas J. Holmes, 1996. "The effects of state policies on the location of industry: evidence from state borders," Staff Report 205, Federal Reserve Bank of Minneapolis.
    5. Charlene M. Kalenkoski & Donald J. Lacombe, 2006. "Right-to-work Laws and Manufacturing Employment: The Importance of Spatial Dependence," Southern Economic Journal, Southern Economic Association, vol. 73(2), pages 402-418, October.
    6. Abadie, Alberto & Diamond, Alexis & Hainmueller, Jens, 2010. "Synthetic Control Methods for Comparative Case Studies: Estimating the Effect of California’s Tobacco Control Program," Journal of the American Statistical Association, American Statistical Association, vol. 105(490), pages 493-505.
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    Cited by:

    1. Dan S. Rickman, 2013. "Should Oklahoma Be More Like Texas? A Taxing Decision," The Review of Regional Studies, Southern Regional Science Association, vol. 43(1), pages 1-22, Summer.

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    Manufacturing Employment; Right-to-Work Laws; Synthetic Control Method; Unionization;

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