Saturday, June 14, 2025

Weaker incentives in unionized plants make them more likely to close

Unionized plants have worse incentive alignment:
  • 26% less likely to offer performance-based bonuses. 
  • 11% less likely to promote based on performance 
  • 13% less likely to dismiss workers for poor performance. 
Consequently, unionized plants have: 
  •  Higher rates of business closures, 
  •  lower investment 
  •  slower employment growth 
BOTTOM LINE:  right-to-work states (no unions) have higher employment and better outcomes. 

CITE:Maksimovic, Vojislav and Yang, Liu A., What do Unions do? Incentives and Investments (June 16, 2023). Available at SSRN:  https://ssrn.com/abstract=4565288 or http://dx.doi.org/10.2139/ssrn.4565288

HT: MarginalRevolution.com

1 comment:

  1. We have created a new text editor!
    Forget the frustrations of existing editors; now you can use a real-time responsive editor designed for bloggers, creators, and students to write faster and more efficiently.
    It helps you maintain the flow of your writing and get immediate results.


    If you are tired of long and complicated text revisions, we highly recommend you give it a try.
    For those who need to write quickly, like bloggers or students, our editor offers a fast and accurate way to complete your writing instantly.


    To be honest, it's still in the development stage, so there might be some areas of improvement.
    Your simple feedback can greatly assist us.
    Thank you!

    Site link:
    https://croll.ai/

    ReplyDelete