The Effect of No-poaching Restrictions on Worker Earnings in Franchised Industries

31 Pages Posted: 25 Jul 2022

See all articles by Brian Callaci

Brian Callaci

Open Markets Institute

Sergio Pinto

University of Maryland; Instituto Universitário de Lisboa (ISCTE-IUL), DINÂMIA'CET

Marshall Steinbaum

University of Utah Department of Economics

Matthew Walsh

Burning Glass Technologies

Date Written: July 6, 2022

Abstract

We investigate the effect of the Washington State Attorney General’s enforcement campaign against employee no-poach clauses in franchising contracts, which unfolded from 2018 until early 2020. We employ a dataset linking chain-level franchising contract provisions with employer-identified job ads from Burning Glass Technologies (BGT). We use several staggered Difference-in-Difference methodologies to measure the effect of removing franchise no-poach clauses on earnings posted in job ads following settlements reached with the Attorney General. Our preferred specification estimates a 3.3% increase in chain-specific annual earnings following no-poach removal.

Keywords: franchising, monopsony, no-poach, horizontal anti-competitive practices

JEL Classification: J01, J41, J42, K21, L2, L41

Suggested Citation

Callaci, Brian and Pinto, Sergio and Steinbaum, Marshall and Walsh, Matthew, The Effect of No-poaching Restrictions on Worker Earnings in Franchised Industries (July 6, 2022). Available at SSRN: https://ssrn.com/abstract=4155577 or http://dx.doi.org/10.2139/ssrn.4155577

Brian Callaci

Open Markets Institute ( email )

1440 G Street NW
Washington, DC 20005
United States

Sergio Pinto

University of Maryland ( email )

College Park
College Park, MD 20742
United States

Instituto Universitário de Lisboa (ISCTE-IUL), DINÂMIA'CET ( email )

Portugal

Marshall Steinbaum (Contact Author)

University of Utah Department of Economics ( email )

1645 Central Campus Dr.
Salt Lake City, UT 84112
United States

HOME PAGE: http://https://faculty.utah.edu/u6024209-Marshall_Steinbaum/hm/index.hml

Matthew Walsh

Burning Glass Technologies

One Lewis Wharf
Boston, MA 02110
United States

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