Racial Inequality in Wealth: Do Labor Unions Matter?

Agnone, Jon-Jason M. 2010. "Racial Inequality in Wealth: Do Labor Unions Matter?" PhD Dissertation, Department of Sociology, University of Washington.
Becky Pettit (Chair), John Mark Ellis (GSR), Margaret Levi, Deborah Minkoff (Barnard College), Barbara Reskin, Jake Rosenfeld.

Extant scholarship has identified the paths of racial wealth inequality to be primarily due to income differences, differential rates of home ownership, and intergenerational wealth transfers. A separate area of scholarly inquiry has highlighted the importance of labor unions in raising wages, increasing the availability of fringe benefits, and increasing pension/retirement assets. Since minorities experience wage returns on par with whites under labor union contracts--which helps to narrow the racial wage gap--it is possible that labor union employment may also help ameliorate the well-documented racial wealth gap. Prior research has failed to examine the possible effect of labor union employment on racial differences in pension/retirement wealth, home ownership, or total wealth. In the first assessment of its kind, I argue for the importance of labor unions as a labor market institution, which can increase the ability of workers to accumulate wealth by providing stable employment, increased wages and increased access to non-wage packages. Representing the synthesis of disparate research areas, I use panel data from the National Longitudinal Survey of Youth (NLSY79) from 1988 to 2004 to examine several ways in which unions can affect wealth by race for whites, blacks and Hispanics. The results suggest that labor union employment increases access to and enrollment in pension plans, and constricts the racial pension/retirement wealth gap by limiting white pension/retirement wealth. Labor union employment increases the likelihood of home ownership for all races, but does not have an effect on the home equity in that home. Finally, labor union employment similarly constricts the racial gaps for non-pension and total wealth, also by limiting the wealth accumulated by whites, but leaving the wealth of blacks and Hispanics unchanged. Collectively, the results of this dissertation find labor unions do impact wealth, but in ways not anticipated prior to analysis of empirical data.

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