Research Handbooks in Law and Economics series
Edited by Cynthia L. Estlund and Michael L. Wachter
Chapter 15: The striking success of the National Labor Relations Act
In the United States today, less than 10 percent of private sector employment is unionized. After peaking at 35 percent of employment in the early 1950s, union membership has been in decline for the last 59 years. This decline represents one of the most important institutional shifts in the United States economy. Reflecting this decline, a common theme among academic legal commentators is that the law governing unionization and collective bargaining, the National Labor Relations Act (NLRA), has been a terrible failure. In this chapter I will make the counter-claim – that the NLRA has been largely successful and in one key area exceedingly successful. Its presumed failure, if the word failure needs to be maintained, is largely due to its successes. Before judging the NLRA to be a success or failure, measures of success have to be identified. I will judge the success of the NLRA by whether the two explicit goals of the Wagner Act of 1935 have been achieved. The goals are industrial peace and a greater balance in bargaining power between employers and employees.
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