Earnings and Employment in Trucking: Deregulating a Naturally Competitive Industry

  • Barry T. Hirsch
  • David A. Macpherson
  • Marcus Alexis
Chapter
Part of the Recent Economic Thought Series book series (RETH, volume 61)

Abstract

The motor carrier industry provides what in many ways is an ideal setting to evaluate the effects of regulation and subsequent deregulation on labor employment and earnings in what is a naturally competitive industry. The trucking industry includes a large number of companies, important segments of the industry are characterized by low capital and entry costs to firms, and, because worker skills are acquired quickly, labor supply is highly elastic. Entry and rate regulation by the Interstate Commerce Commission (ICC), coupled with the emergence of a powerful trade union (the International Brotherhood of Teamsters), resulted in the capture and maintenance of labor rents by drivers. At the same time that the motor carrier industry was subject to strict entry and rate regulation, however, many shippers had the ability to escape direct ICC regulation through the use of unregulated private carriage (i.e., own-company employment of drivers).

Keywords

Current Population Survey Truck Driver Union Wage Wage Change Nonunion Wage 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.
This is a preview of subscription content, log in to check access.

Preview

Unable to display preview. Download preview PDF.

Unable to display preview. Download preview PDF.

References

References

  1. Alchian, Armen A. and Kessel, Reuben A. “Competition, Monopoly and the Pursuit of Money.” In Aspects of Labor Economics. Princeton, New Jersey: Princeton University Press and the National Bureau of Economic Research, 1962.Google Scholar
  2. Becker, Gary S. The Economics of Discrimination. Chicago, Illinois: University of Chicago Press, 1957.Google Scholar
  3. Belzer, Michael, H. “The Motor Carrier Industry: Truckers and Teamsters Under Siege.” In Contemporary Collective Bargaining in the Private Sector. Edited by Paula B. Voos, Madison, Wisconsin: Industrial Relations Research Association„ 1994.Google Scholar
  4. Belzer, Michael H. “Collective Bargaining After Deregulation: Do the Teamsters Still Count? Industrial and Labor Relations Review. 48 (1995): 636–55.CrossRefGoogle Scholar
  5. Bosworth, Barry and Perry, George, L. “Productivity and Real Wages: Is There a Puzzle?” Brookings Papers on Economic Activity. 1 (1994): 317–44.CrossRefGoogle Scholar
  6. Bound, John, and Brown, Charles, and Duncan, Greg J., and Rodgers, Willard L. “Evidence on the Validity of Cross-sectional and Longitudinal Labor Market Data.” Journal of Labor Economics. 12 (1994): 345–68.CrossRefGoogle Scholar
  7. Boyer, Kenneth D. “The Costs of Price Regulation: Lessons From Railroad Deregulation.” Rand Journal of Economics. 18 (1987): 408–16.CrossRefGoogle Scholar
  8. Brown, Charles and Medoff, James. “The Employer Size-Wage Effect.” Journal of Political Economy. 97 (1989): 1027–59.CrossRefGoogle Scholar
  9. Card, David. “The Impact of Deregulation on the Employment and Wages of Airline Mechanics.” Industrial and Labor Relations Review. 39 (1986): 527–38.CrossRefGoogle Scholar
  10. Card, David. “Deregulation and Labor Earnings in the Airline Industry.” Industrial Relations Section Working Paper #247, Princeton University, January 1989.Google Scholar
  11. Card, David. “Deregulation and Labor Earnings in the Airline Industry.” In Regulatory Reform and Labor Markets. Edited by James Peoples, Norwell, Massachusetts: pringer Science+Business Media New York, 1998.Google Scholar
  12. Cremieux, Pierre-Yves. “The Effect of Deregulation on Employee Earnings: Pilots, Flight Attendants, and Mechanics, 1959–1992.” Industrial and Labor Relations Review. 49 (1996): 223–42.CrossRefGoogle Scholar
  13. Dodge, Eric R., and Stone, Joe A., and Wilson, Wesley W. “Wage Premia, Organization Costs, and Market Segments: The Determination of Union Status in the Motor-Carrier Industry.” University of Oregon, October 1994.Google Scholar
  14. Ehrenberg, Ronald G. The Regulatory Process and Labor Earnings. New York, New York: Academic Press, 1979.Google Scholar
  15. England, Paula, and Kilbourne, Barbara. Occupational Measures from the Dictionary of Occupational Titles for 1980 Census Detailed Occupations. Ann Arbor, Michigan: Inter-university Consortium for Political and Social Research, ICPSR #8942, Ann Arbor, Michigan Fall, 1988.Google Scholar
  16. Even, William E. and Macpherson, David A. “Employer Size and Labor Turnover: The Role of Pensions.” Industrial and Labor Relations Review, 49 (1996): 707–28.CrossRefGoogle Scholar
  17. Freeman, Richard B. “Longitudinal Analyses of the Effects of Trade Unions.” Journal of Labor Economics. 2 (1984): 1–26.CrossRefGoogle Scholar
  18. Gibbons, Robert and Katz, Lawrence F. “Does Unmeasured Ability Explain Interindustry Wage Differentials?” Review of Economic Studies. 59 (1992): 515–35.CrossRefGoogle Scholar
  19. Hamermesh, Daniel S. “Who Works When? Evidence from the U.S. and Germany.” National Bureau of Economic Research Working Paper No. 5208, August 1995.Google Scholar
  20. Hendricks, Wallace. “Regulation and Labor Earnings.” Bell Journal of Economics. 8 (1977): 483–96.CrossRefGoogle Scholar
  21. Hendricks, Wallace. “Collective Bargaining in Regulated Industries.” In Advances in Industrial and Labor Relations, Vol. 3. Edited by David B. Lipsky and David Lewin, Greenwich, Connecticut: JAI Press, 1986.Google Scholar
  22. Hendricks, Wallace. “Deregulation and Labor Earnings.” Journal of Labor Research. 15 (1994): 207–34.CrossRefGoogle Scholar
  23. Heywood, John S. “Regulated Industries and Measures of Earnings Discrimina tion.” In Regulatory Reform and Labor Markets. Edited by James Peoples. Norwell, Massachusetts: pringer Science+Business Media New York, 1998.Google Scholar
  24. Heywood, John S. and Peoples, James H. “Deregulation and the Prevalence of Black Truck Drivers.” Journal of Law and Economics. 37 (1994): 133–55.CrossRefGoogle Scholar
  25. Hirsch, Barry T. “Trucking Regulation, Unionization, and Labor Earnings: 197385.” Journal of Human Resources 23 (1988): 296–319.CrossRefGoogle Scholar
  26. Hirsch, Barry T. “Trucking Deregulation and Labor Earnings: Is the Union Premium a Compensating Differential?” Journal of Labor Economics. 11 (1993): 279–301.CrossRefGoogle Scholar
  27. Hirsch, Barry T. and Macpherson, David A. “Earnings, Rents, and Competition in the Airline Labor Market.” Florida State University Economics Working Paper 94–12–1, December 1995.Google Scholar
  28. Hirsch, Barry T. and Macpherson, David A. Union Membership and Earnings Data Book: Compilations from the Current Population Survey (1996 Edition). Washington, D.C.: Bureau of National Affairs, 1996.Google Scholar
  29. Jakubson, George. “Estimation and Testing of the Union Wage Effect Using Panel Data.” Review of Economic Studies. 58 (1991): 971–91.CrossRefGoogle Scholar
  30. Kostiuk, Peter F. “Compensating Differentials for Shift Work.” Journal of Political Economy. 98 (1990): 1054–75.CrossRefGoogle Scholar
  31. MacDonald, James, M. and Cavalluzzo, Linda C. “Railroad Deregulation: Pricing Behavior, Shipper Responses, and the Effects on Labor.”Industrial and Labor Relations Review. 50 (1996): 80–91.CrossRefGoogle Scholar
  32. Meyer, Bruce D. “Natural and Quasi-Experiments in Economics.” National Bureau of Economic Research Technical Working Paper No. 170, December 1994.Google Scholar
  33. Miller, Ann R., and Treiman, Donald J., and Cain, Pamela S., and Roos, Patricia A. (editors.). Work, Jobs, and Occupations: A Critical Review of the Dictionary of Occupational Titles (Final Report to the U.S. Department of Labor by the Committee on Occupational Classification and Analysis). Washington, D.C.: National Academy Press, 1980.Google Scholar
  34. Moore, Thomas Gale. “The Beneficiaries of Trucking Regulation.” Journal of Law and Economics. 21 (1978): 327–43.CrossRefGoogle Scholar
  35. Moore, Thomas Gale. “Rail and Truck Reform - The Record So Far.” Regulation (1983): 33–41.Google Scholar
  36. Paxson, Christina H. and Sicherman, Nachum. “The Dynamics of Dual Job Holding and Job Mobility.” Journal of Labor Economics. 14 (1996): 357–93CrossRefGoogle Scholar
  37. Peracchi, Franco, and Welch, Finis. “How Representative Are Matched Cross Sections? Evidence from the Current Population Survey.” Journal of Econometrics. 68 (1995): 153–79.CrossRefGoogle Scholar
  38. Peoples, James H. and Peteraf, Margaret. “Deregulation and the Competitive Fringe: Owner-Operators in the Trucking Industry.” Journal of Regulatory Economics. 7 (1995): 27–42.CrossRefGoogle Scholar
  39. Peoples, James H. and Saunders, Lisa. “Trucking Deregulation and the Black/ White Wage Gap.” Industrial and Labor Relations Review. 47 (1993): 23–35.CrossRefGoogle Scholar
  40. Perry, Charles R. Deregulation and the Decline of the Unionized Trucking Industry. Philadelphia, Pennsylvania: Wharton School’s Industrial Research Unit, 1986.Google Scholar
  41. Polivka, Anne E. and Rothgeb, Jennifer M. “Overhauling the Current Population Survey: Redesigning the Questionnaire.” Monthly Labor Review. 116 (1993): 10–28.Google Scholar
  42. Rose, Nancy L. “The Incidence of Regulatory Rents in the Motor Carrier Industry.” Rand Journal of Economics. 16 (1985): 299–318.CrossRefGoogle Scholar
  43. Rose, Nancy L. “Labor Rent-Sharing and Regulation: Evidence From the Trucking Industry.” Journal of Political Economy. 95 (1987): 1146–78.CrossRefGoogle Scholar
  44. Wessels, Walter. “Do Unionized Firms Hire Better Workers?” Economic Inquiry.32 (1994): 616–29.CrossRefGoogle Scholar
  45. Winston, Clifford. “Economic Deregulation: Days of Reckoning for Micro-economists.” Journal of Economic Literature. 31 (1993): 1263–89.Google Scholar

References

  1. Alexis, Marcus “The Applied Theory of Regulation: Political Economy at the Interstate Commerce Commission,” Public Choice, 39 (1982): 5–97.CrossRefGoogle Scholar
  2. Annable, James E. Jr. “The ICC, the IBT and the Cartelization of the American Trucking Industry.” Quarterly Review of Economics and Business, 13 (1973): 13–47.Google Scholar
  3. Belzer, Michael, “Collective Bargaining After Deregulation: Do the Teamsters Still Count?” Industrial and Labor Relations Review, 48 (July 1995):636–55.CrossRefGoogle Scholar
  4. Belzer, Michael, “The Motor Carrier Industry: Truckers and Teamsters Under Siege.” In Contemporary Collective Bargaining in the Private Sector, Madison, Wisconsin: Industrial Relations Research Association, Edited by Paula B. Voos, 1994Google Scholar
  5. Corsi, Thomas and Stowers, Joseph, “Effects of a Deregulated Environment on Motor Carriers: A Systematic Multi-Segment Analysis.” Transportation Journal, 30 (1991): 4–28.Google Scholar
  6. Hirsch, Barry, T. “Trucking Regulation, Unionization and Labor Earnings, 197385.” Journal of Human Resources, 23 (1988): 296–319.CrossRefGoogle Scholar
  7. Lane, L. Lee. “Intermodal Trends” An AAR/Intermodal Policy Division Report (1989).Google Scholar
  8. Moore, Thomas G. “The Beneficiaries of Trucking Regulation.” Journal of Law and Economics, 21 (1978): 327–43.CrossRefGoogle Scholar
  9. Moore, Thomas, G. “Comment on The Applied Theory of Regulation: Political Economy at the Interstate Commerce Commission,”Public Choice, 39 (1982): 29–32.CrossRefGoogle Scholar
  10. Perry, Charles. Deregulation and the Decline of Unionized Trucking, Philadelphia, PA” Wharton Industrial Research Unit, 1986.Google Scholar
  11. Rose, Nancy L. “Labor Rent-Sharing and Regulation: Evidence From the Trucking Industry.” Journal of Political Economy, 95 (1987): 1146–78.CrossRefGoogle Scholar

Copyright information

© Springer Science+Business Media New York 1998

Authors and Affiliations

  • Barry T. Hirsch
  • David A. Macpherson
  • Marcus Alexis

There are no affiliations available

Personalised recommendations