Go South Young Man: Right to Work Laws and the US Labor Market

Citation:

Matthew Lilley and Benjamin Austin. In Preparation. “Go South Young Man: Right to Work Laws and the US Labor Market”.

Abstract:

In recent decades, states with Right-To-Work (RTW) laws have experienced higher employment than states without such laws. We investigate the extent to which these patterns, and other related labor market phenomena, are causally explained by these laws and closely related policies. Using border-pair differences, we find RTW laws are associated with a 2.8 percentage point increase in the share of manufacturing employment, a 1.6 percentage point increase in employment, and a 0.34 percentage point decrease in disability receipt. RTW laws are also associated with greater upward mobility, with a 1.6 percentage point increase in the probability of reaching the top quintile for children at the 25th percentile of parental income. These differences in industry and employment levels were not present prior to the passage of RTW laws, persist after controlling for other major policy differences between states, and do not appear primarily attributable to local substitution. 
Last updated on 10/30/2020