Industrial relations : a journal of economy and society
Place of publication
The effect of unions on profits continues to be an unresolved theoretical and empirical issue. In this paper, clustered data analysis and hierarchical linear meta-regression models are applied to the population of forty-five econometric studies that report 532 estimates of the direct effect of unions on profits. Unions have a significant negative effect on profits in the United States, and this effect is larger when market-based measures of profits are used. Separate meta-regression analyses are used to identify the effects of market power and long-lived assets on profits, as well as the sources of union-profit effects. The accumulated evidence rejects market power as a source of union-profit effects. While the case is not yet proven, there is some evidence in support of the appropriation of quasi-rent hypothesis. There is a clear need for further American and non-American primary research in this area.