What factors explain the divergence between returns to labour and overall productivity across US counties? We model the role of power at the subnational state level: Republican partisan control, corporate lobbying (measured by ALEC-sponsored bills) and labour power (unionisation). We find where state policy is captured by corporate interests, this undermines inclusive growth. Our hierarchical models use 2012 data for county areas in the continental USA and find labour returns are higher in states with more unionisation, but lower in states with Republican control and more corporate penetration of state legislatures. Labour and local government power have limited effect.
CITATION STYLE
Warner, M. E., & Xu, Y. (2021). Productivity divergence: State policy, corporate capture and labour power in the USA. Cambridge Journal of Regions, Economy and Society, 14(1), 51–68. https://doi.org/10.1093/cjres/rsaa040
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