Right to Work Laws and Union Membership

Abstract

This thesis investigates the impact of recent Right-to-Work (RTW) laws on private sector union membership. To better understand the mechanism through which RTW affects unions, this thesis evaluates the effect of recent RTW laws in Indiana, Michigan and Wisconsin on four outcomes: private sector union density, the percentage the labor force covered by union contracts without being a union member, the demographic makeup of labor unions, and union density within demographic groups. Using data from the Current Population Survey, this thesis uses four difference-in-differences models to answer these questions. This thesis found that RTW laws had a significant negative effect on union density, and did not find any effect of RTW on the percentage the labor force covered by union contracts without being a union member. This thesis did not find any effect of RTW on the demographic makeup of labor unions. However, this thesis did find that the magnitude of RTW’s impact on union density was largest among groups that were over represented in unions before RTW, especially black workers. The results of this thesis suggest that RTW laws impose a collective action problem that decreases the extent of unionization, and has negative implications for unions’ ability to play an equalizing role in the labor market.