21
III. Conclusions
Many of the labor laws that we now have on the books were adopted prior to the New
Deal: limits on child labor, limits on working time, safety legislation, and workers’
compensation laws. As we have seen, the causes of some of these early pieces of
legislation at state level have been analyzed and with them the bargaining process
between employers and workers as filtered through state-level politics. Interestingly, we
have far less information on the political economy of national labor mandates, since the
modern preoccupation has been to analyze the effects of legislation. Viewed from this
imperative, the causes of mandates have only been examined in the interests of obtaining
unbiased estimates of their consequences. Auxiliary equations apart, the political
involvement of the labor and product market actors have been adduced from the payoffs
to them of legislation. Another interactive line of inquiry is opened up by the actions of
the courts. At the broadest level, legislation has been seen as a broad antidote to the
‘subversion’ of the courts. Less dramatically, individual pieces of legislation have been
sponsored because of the high transactions costs of using the courts. On the other hand,
recourse to the law has also been seen as a remedy for overarching state and local
legislation.
In reviewing the effects of U.S. labor legislation, Addison and Hirsch (1997, p. 166)
remark that the empirical literature suggests that workplace mandates have rather muted
benefits and costs, noting that the effects of mandates are mitigated in part through
market escape routes, the shifting of costs, and the mobility of resources, and in part via a
political process that shows some sensitivity to both benefits and costs. Our discussion of
rent seeking, codification, coalitions, judicial review, and interjurisdictional competition
gives some credence to this position, without of course claiming that the regulations
generally work well for employers, employees, or for that matter the regulators
Lest our limited discussion of national mandates still convey the impression that the U.S.
labor market is unregulated at the federal level, however, let us dispel that notion by
observing that by the mid-1990s the U.S. Department of Labor was administering some