Reputation, Membership and Wages in Open Shop Trade Union

In Britain there is no longer statutory support for the closed shop and in the United States many states have right-to-work laws. Wages and membership determination are examined in this setting. The main findings are: (1) already established unions will not necessarily wither away with the mere passage of right-to-work laws: (2) however, they may disintegrate when faced with substantial negative demand shocks; (3) new unions will find it harder to become established; (4) greater dispersion in worker attitudes to joining unions will lower membership but not necessarily wages, which is broadly consistent with some empirical studies.