How does organizational higher purpose affect employee behavior and firm output? We develop an optimal-contracting model which shows that pursuing organizational higher purpose dissipates agency frictions, lowers wage costs and...
We analyze how employee compensation contracts of target firms affect merger terms and outcomes. Using unique data from merger agreements, we document that in 80.0% of all M\&A deals at least some of the target's ESOs are canceled by...
Extending the theories of employee incentives and inalienability of human capital, we investigate the link between a firm’s engagement in employee issues and the returns to shareholders around mergers and acquisitions (M&As)...
Economic models routinely assume firms maximize shareholder wealth; however common law legal systems only require that officers and directors pursue the interests of the corporation, leaving this ill-defined. Economic arguments...
If unemployment insurance is more generous, workers should demand less implicit insurance from their employers: firm- and government-provided insurance should be substitutes. Using a firm-level international panel dataset, we...
We study the human-capital effects of private equity buyouts in Germany. We conduct matched-sample difference-in-differences estimations at the establishment and at the individual employee level with more than 152,000 buyout...
Do employees who compare themselves to the CEO matter for executive compensation? We hypothesize that employees have relative wealth concerns and compare their wage to the CEO’s pay. Using German establishmentlevel wage data, we...
This paper presents findings from analysis of a dataset of labour laws, based on the Centre for Business Research Labour Regulation Index (CBR-LRI), which has recently been extended to cover 117 countries and the period from 1970 to...
We examine the potential for management-worker alliances when employees have substantial voting rights, and how such alliances affect the balance of power between managers and shareholders. We find that substantial employee voting...
We develop a model of competition for managerial talent in which firms asymmetrically learn about the ability of their managers. In equilibrium, firms poach talent from competitors, even in the absence of gains from trade. Our main...
Retirement investing in the United States has changed dramatically. The classic defined-benefit (DB) plan has largely been replaced by the defined contribution (DC) plan. With the latter, individual employees’...
During the Harvey Weinstein and #MeToo events, firms with a non-sexist corporate culture, proxied by having women among the five highest paid executives, earn excess returns of 1.6%. These returns are followed by positive revisions in...