Please use this identifier to cite or link to this item: http://hdl.handle.net/10125/77046

Shadow Union in Local Labor Markets and Capital Structure

File Size Format  
HARC-2022 paper 345.pdf 1.41 MB Adobe PDF View/Open

Item Summary

Title:Shadow Union in Local Labor Markets and Capital Structure
Authors:Cho, Duckki
Choi, Lyungmae
Keywords:Shadow Union
Local Labor Market
Threat of Unionization
Capital Structure
Date Issued:2021
Abstract:This paper identifies an externality of a firm’s unionization that affects the capital structure decisions of non-unionized firms within a local labor market. We find that a union victory leads non-unionized firms to increase market leverage ratios by 0.9 to 1.3 percentage points. This "shadow union" effect is more pronounced when the probability of unionization rises in a larger margin and firms face higher union rents conditional on being unionized. The threat is credible enough to shape corporate financing decisions: shadow unions raise the wages of employees and increase the likelihood of subsequent union victories in the relevant labor market.
URI:http://hdl.handle.net/10125/77046
Appears in Collections: 10 Financial Accounting 4: Accounting issues related to labor, politics, and environments (FAR4)


Please email libraryada-l@lists.hawaii.edu if you need this content in ADA-compliant format.

Items in ScholarSpace are protected by copyright, with all rights reserved, unless otherwise indicated.