The right to work, power resources, and economic inequality¹

How do right to work laws affect the distribution of economic resources? While sociological theories would predict inequality to increase following their passage, previous research finds these laws to be largely inconsequential. The author compiles a unique data set of 77 years of income and wage inequality data from the Internal Revenue Service, the U.S. census, the U.S. Union Sourcebook, and the National Labor Relations Board. After replicating inconsistent results from previous studies, the author shows that they mask substantial and robust heterogeneity across local areas. Right to work laws are consequential when passed in times and places where labor has something to lose. They remove the negative association between labor union membership and inequality, with the greatest consequences of right to work passage 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.