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Union Rights and Inequalities

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Abstract

Competing arguments surrounding the relationships between inequalities and labor rights have persisted over time. This paper explores whether labor rights increase or decrease two types of wage inequalities: vertical inequality and horizontal inequality. Vertical inequalities reflect inequalities in wealth or income between individuals, while horizontal inequalities reflect inequalities between social, ethnic, economic, and political groups which are usually culturally defined or socially constructed. By broadening the scope beyond traditional indicators of inequality (i.e., vertical inequality) to include horizontal inequality, we test whether government respect for labor rights can help reduce inequality. We find that as labor rights and practices improve, countries see a decrease in horizontal inequality. Furthermore, as stronger protections for labor rights improve within countries, this also serves to reduce individual levels of inequality (i.e., vertical inequality).

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Data Availability

Data and programming necessary for replication are available by request and on the corresponding author's website, smbagwell.com.

Notes

  1. Horizontal inequality can be broken down further into negative horizontal inequality (NHI) and positive horizontal inequality (PHI). NHI refers to the distance between the lowest earning group and the average, while PHI refers to the distance between the highest earning group and the average. Effectively, these are measures of the “floor” and “ceiling” effects of lower earning groups and higher earning groups, respectively. We discuss the conceptualization and operationalization of these terms later in the paper.

  2. Positive horizontal inequality (PHI) is equivalent to the mean per capita income of the richest group in a society divided by country-level GDP. Negative horizontal inequality (NHI) is equal to country-level GDP per capita divided by the mean per capita income for the poorest group in the country.

  3. There is debate about whether this applies to citizens or all persons a geographical territory.

  4. Unfortunately, the measures of horizontal inequality ceased being updated after 2005, limiting the temporal scope of our analysis.

  5. We opted to use the modeling strategy employed by Mosley and Uno (2007) who have similarly structured data.

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Authors and Affiliations

  1. University of Missouri-St. Louis, St. Louis, USA

    Stephen Bagwell

  2. University of Rhode Island, Kingston, USA

    Skip Mark

  3. University of Georgia, Athens, USA

    Meridith LaVelle & Asia Parker

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Correspondence to Stephen Bagwell.

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“Inequality threatens long-term social and economic development, harms poverty reduction and destroys people’s sense of fulfilment and self-worth. This, in turn, can breed crime, disease and environmental degradation.” (United Nations Sustainable Development Goal 10)

The authors would like to thank two anonymous reviewers as well as the editorial team for their thoughtful comments and suggestions during the review process. All authors contributed equally to the development and editing of the manuscript.

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Bagwell, S., Mark, S., LaVelle, M. et al. Union Rights and Inequalities. Hum Rights Rev 24, 465–483 (2023). https://doi.org/10.1007/s12142-023-00706-3

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