Regulation, market power, and labor earnings: Evidence from the cable television industry

Labor economists have suggested that employee earnings may be relatively higher in firms possessing market power, such as that which may stem from government regula-tion of prices or entry of firms. We test this hypothesis, which previously has been inves-tigated in the context of industries such as trucking and air transportation, using earnings data for the cable television industry. Our empirical findings suggest that cable TV employees capture some of the benefits producers receive from regulations restricting competition.