Unions’ Internal Networks and Spillovers: Evidence from Right-to-Work Laws in the US
Abstract
We document the expanding geographic scope of labor unions in the US and show how the resulting organizational networks propagate shocks across distant labor markets. The number of states the average union local (union branch) operated in doubled from 1.5 in 2001 to 3 in 2011. As a consequence, shocks to unionized workers in one state are likely to have spillovers if unions respond by reallocating resources across states. We show this mechanism at work in the context of state-level Right-to-Work (RTW) laws, which make it optional to pay union dues. A model of a multistate union predicts spillovers with a sign that depends on the relative strength of substitution and scale effects. We test for spillovers using variation in union exposure to five RTW laws adopted between 2012 and 2017. RTW laws have negative direct effects in adopting states and positive spillovers; the average union represents 1.2 fewer bargaining units in adopting states and makes up for 35 percent of this loss in worker-level coverage by substituting towards non-adopting states. Notably, more than half of the spillover occurs in non-bordering states. We find no effect on the price or quality of union services. New organizing explains 34 percent of the spillover; the rest is explained by successful contract renegotiation for existing members. Despite the substitution, unions see a persistent decline in membership, revenues, and assets.
BibTeX
@unpublished{buschjainpuerta2026spillovers,
author = {Busch, Alexander and Jain, Nidhaanjit and Puerta, Sebastian},
title = {Unions' Internal Networks and Spillovers:
Evidence from Right-to-Work Laws in the US},
note = {Working paper},
year = {2026}
}