Benefits of collective bargaining in the local public sector are always nonrival for
covered employees. In states with public sector right-to-work laws, they are also
nonexcludable. Among 10,308 county and city departments that were nonunion in
1977, the probability of engaging in collective bargaining as of 1982 was signifi
cantly and substantially lower in states with right-to-work laws. Furthermore, the
larger the department the greater the reductton in the probability of forming a
bargaining union. These results are the first nonexperimental evidence of the effects
of free riders on the provision of a public good They support the hypothesis that,
without excludability, free riders reduce the levels of public good provision.
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