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Household Debt and Union Jobs: Evidence from Bankruptcy Reform

Author

Listed:
  • Po Yin Wong
  • Giorgos Gouzoulis
  • Giorgos Galanis

Abstract

This paper examines how household indebtedness shapes union participation in the United States, using PSID data (1999–2021) and the 2005 Bankruptcy Abuse Prevention and Consumer Protection Act as a natural experiment: households above their state median income lost access to Chapter 7 bankruptcy, raising the cost of consumer debt. Treated households deleveraged, and their union participation fell on the margin made financially meaningful by state labor law: entry into union-covered jobs in non-Right-to-Work states, and retention of formal membership in Right-to-Work states. Our findings show that personal balance sheets and labor law jointly shape workers' collective representation.

Suggested Citation

  • Po Yin Wong & Giorgos Gouzoulis & Giorgos Galanis, 2026. "Household Debt and Union Jobs: Evidence from Bankruptcy Reform," Working Papers PKWP2618, Post Keynesian Economics Society (PKES).
    • Handle: RePEc:pke:wpaper:pkwp2618
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    References listed on IDEAS

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    More about this item

    Keywords

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    JEL classification:

    • J50 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - General
    • J51 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Trade Unions: Objectives, Structure, and Effects
    • K35 - Law and Economics - - Other Substantive Areas of Law - - - Personal Bankruptcy Law

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