NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Unionism, Price-Cost Margins, and the Return to Capital

Richard B. Freeman

NBER Working Paper No. 1164
Issued in July 1983
NBER Program(s):   LS

This paper examines available industry data on two profitability measures, the price-cost margin and the ratio of quasi-rents to capital, for the purpose of determining the effect of unionism on profits. It finds that unionism reduces profitability and that this effect occurs in highly concentrated industries. The effect of unionism is quite substantial in most calculations, suggesting that the fraction organized in a sector be included in standard Industrial Organization profitability calculations in the future.

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Document Object Identifier (DOI): 10.3386/w1164

 
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