How Does Going Public Affect Employees? Evidence from Glassdoor Reviews

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2022
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Pinto, Jedson
Li, Meng
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In this paper, we utilize a novel dataset form Glassdoor.com to examine how initial public offerings (IPOs) influence employee satisfaction with their employers. Using generalized difference-in-differences methodology, we document that employees become less satisfied after their employers go public. We show that firm size, industry competition, firm complexity, and employee education levels do not drive this finding. Using JOBS Act as an exogenous shock, we find that higher regulatory burden is likely to be an important reason why employees become less satisfied after an IPO. Our results provide new insights on how firms going public affect employee welfare, and the potential mechanism behind it
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Regulation, Ownership structure, Compliance costs, Human capital
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