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Abstract
In this article, I seek to fill a gap in the literature by analyzing how central changes in labor laws shaped intrafirm power dynamics and thus income inequality during the Gilded Age and Progressive and New Eras. For the North, I look at the increasing activism of courts, to the detriment of many state and local legislatures, in creating and expanding the use of the labor injunction. For the South, I look at how the states, supported by the courts, created a system of peonage that directly affected large portions of southern labor and lasted well into the 20th century.
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Notes
1 The Gilded Age usually refers to the period between Reconstruction and the turn of the twentieth century. Here, I use the term long Gilded Age to refer to the years between Reconstruction and the Great Depression. This includes what is usually called the Progressive Era—the first two decades of the twentieth century—and the New Era—the 1920s.
2 The relationship between market concentration, market power, and rents can be seen through analysis of the Nash equilibrium of a N identical firm Cournot oligopoly.
3 A horizontal merger is the acquisition or consolidation of firms that produce the same or similar products. A vertical merger is the acquisition or consolidation of firms that produce goods farther back or farther along in a product chain, and a product extension merger is the combination of firms that produce non-related goods.
4 Economies of scale signify that an increase in quantity produced leads to a decrease in average cost per unit of output.
5 It should be noted that Currie and Ferrie (Citation2000) concluded that the threat of injunctions had little effect on strike outcomes and that injunctions increased strike length. However, this conclusion is problematic because it ignores their own findings from previous regression and because the regression results which support the conclusion don’t show what they claim. In terms of the first point, they completely ignore their results from Tables 3, 4, and 6 and solely weigh their conclusions on their last set of regressions (presented in Table 7). As mentioned above, they find, among other things, that injunctions led to significantly less strikes in the future and workers at smaller firms were more likely to strike and unions were more likely to authorize strikes where there was no history of injunctions. This most likely stems from workers realizing that they were less likely to win strikes when injunctions were used——contrary to their highlighted conclusion. In terms of the second point, their findings in their last set of regressions, from which their main conclusion is drawn, do not show that injunctions had little effect on strike outcomes or extended strikes. They use firm-level data to look at strike outcomes, but their injunction variable counts previous use in the area—not injunctions used in the strike in question.
6 Struck down: State ex rel. Zillmer v. Kreutzberg, 114 Wis. 530, 90 N.W. 1098 (1902); Gillespie v. People, 188 Ill. 176, 58 N.E. 1007 (1900); State v. Bateman, 10 Ohio Dec. 68 (Ohio C.P. 1900); Commonwealth v. Clark, 14 Pa. Super. 435 (1900); State v. Julow, 129 Mo. 163, 31 S.W. 781 (1895); Davis v. State, 30 Ohio Wkly. Law Bull. 342 (Ohio C.P. 1893); Upheld: Curran v. Galen, 2 Misc. 553, 22 N.Y.S. 826, aff’d, 152 N.Y. 33 (1893).
7 15 U.S.C. §§ 12–27, 29 U.S.C. §§ 52–53.
8 See Lawlor v. Loewe, 235 U.S. 522, 536-37 (1915), pp. 202–203.
9 Tennessee, Acts, 1875, pp. 168, 188–189.
10 Toney v. State, 141 Ala. 120 (1904); State v. Armstead, 103 Miss. 790 (1913).
11 Louisiana, laws, 1890, p. 178; State v. Oliva, 144 La. 51 (1918).
12 Bailey v. Alabama, 219 U.S. 231 (1911).
13 Taylor v. Georgia, 315 U.S. 25 (1941); Pollock v. Williams, 322 U.S. 4 (1944).
14 For complaints about peonage in Alabama in the 1940s, see National Archive files 50-1/3. For a general guide, see United States. Department of Justice, & Schipper, M. P. (1989). The peonage files of the US Department of Justice, 1901-1945. P. Daniel (Ed.). University Publications of America.
15 Woodrow Wilson, who became President in 1913, was no friend of African American civil rights. After watching the Birth of a Nation, a film on how the Ku Klux Klan saved the United States by taking back control of government from blacks after Reconstruction, Wilson commented, “My only regret [of the film] is that it is all so terribly true” (Blackmo, 2008, pp. 355 and 359).
16 Laws of Florida, 1906, 1315.
17 Redeemers refer to the White Democrats who retook control of state and local legislatures in the South after Reconstruction. Redemption refers to the period itself.
18 Because of the discrepancy in actual and reported labor injunctions and the extensive controls in regression (1) for other variation, I attribute year fixed effects to the anti-labor climate that went in tandem with injunctions.
19 New York Times, “Drawn Battle?” July 27, 1877, p. 4.
20 New York Times, “Cars must not be stopped,” July 3, 1894, P. 1.