The Right to Work, Power Resources, and Economic Inequality

Abstract

How do Right to Work laws affect the distribution of economic resources? While sociological theories would predict inequality to increase following the passage of Right to Work laws, previous research has found these laws to be largely inconsequential for economic inequality. Drawing on power resources theory, I reassess the consequences of Right to Work laws and allow their impact to depend upon local union membership. To do so, I construct unique datasets at the state and commuting zone levels of income and wage inequality, merging data from the Internal Revenue Service, the US census, the American Community Survey, the US Union Sourcebook, the Current Population Survey, and the National Labor Relations Board for years 1939 to 2016. After using two-way fixed effects and instrumental variable regression models to replicate inconsistent results of previous studies, I show that these mask substantial and robust heterogeneity across local areas. Simply put, Right to Work laws are highly consequential when passed in times and places where labor has something to lose. Right to Work laws remove the negative association between labor union membership and inequality, while the consequences of Right to Work passage are greatest in highly unionized areas. In total, results suggest that Right to Work laws work as intended, increasing economic inequality indirectly by lowering labor power resources. Theoretical and policy implications are discussed.

Consequences of income concentration for democratic processes in contemporary Western and comparable societies: Evidence for OECD countries, 2017–2019

“…In other words, Hypothesis 1 predicts that the higher Gini coefficients of income distribution are, the lower political democracy indexes will be, and vice versa, among OECD countries. This hypothesis both logically derives from the theoretical framework outlined previously and is consistent with the empirical observations cited from the extant literature (especially Piketty, 2014, 2020also, Acemoglu et al, 2010Vermeiren, 2021;. To that extent, it is both theoretically relevant and empirically grounded.…”

“…As a result, one can realistically expect authoritarian and dictatorial policies in core countries of the West in the foreseeable future. Indeed, one can already identify authoritarian and dictatorial policies in such Western core countries, primarily the United States under the post-2016 ultra-conservative, radical right autocratic regime and earlier, as during and since Reaganism, and to some degree in Brexit Great Britain as well as during Thatcherism (Alvaredo et al, 2018; Bonikowski et al, 2021; Gethin et al, 2022; Jacobs and Dirlam, 2016; Lamont, 2018; Piketty, 2014; VanHeuvelen, 2020). And one can expect that such illiberal and undemocratic tendencies will persist, even expand and intensity in these and probably via contagion or contamination in other Western core and less central countries experiencing the high or growing concentration of income and wealth (Piketty, 2020).…”

State Union Density Effects on Workers’ Support for Reducing Income Inequality, 1973-2016

“…Countries with stronger welfare regimes/policies tend to have more union members and US interstate regions and industries with more deunionization have more wage dispersion (Korpi 1985; Bradley et al 2003; Western and Rosenfeld 2011). Power Resource Theory suggests that unions increase welfare spending in part by fostering strong “negative attitudes” against individuals who increase inequality or make welfare cuts, allowing workers to “punish” or “reward” those in power (Stephens 1979; Korpi 1983; Korpi 1985; Esping-Andersen 1990; Jacobs and Dirlam 2016; VanHeuvelen 2020). Similarly, the moral economy perspective argues that unions reduce income inequality in part by fostering strong egalitarian pay norms (Svallfors 2006; Western and Rosenfeld 2011).…”

Social capital exchanges in voluntary associations and work organizations: A network perspective

“…Higher‐placed workers command access to more social and cultural resources that help upward mobility in organizations by exerting a positive cooperative influence on colleagues at and above their own position, but which keep the cumulative advantage to those of higher classes with superior education and financial resources to access these cultural resources (Basov, 2020; Erickson, 1996; Van Hauvelen, 2020).…”