Labor Unions, Operating Flexibility, and the Cost of Equity

By H. Chen, Marcin T. Kacperczyk, Hernán Ortiz-Molina. Journal of Financial and Quantitative Analysis, 2010

400 citations recorded by the source corpus.

Subfields: Accounting, Strategy and Management

View Paper: https://www.semanticscholar.org/paper/6e3b66469eb87598d46edb68a5e1664b214e9cb5

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Citations in the corpus

Employee Rights and Acquisitions (2015, neutral): “Chen, Kacperczyk, and Ortiz-Molina (2011) show that the decrease in operating flexibility associated with the presence of a union is compensated with higher expected returns.”
Real Asset Illiquidity and the Cost of Capital (2014, background): “…and Li (2006)), cross-listing (Hail and Leuz (2009)), governance and country-level investor protection (Chen, Chen, and Wei (2009)), default risk (Chava and Purnanandam (2010)), shareholder rights (Chen, Chen, and Wei (2011)), and labor unionization (Chen, Kacperczyk, and Ortiz-Molina (2011)).”
Boarding a Sinking Ship? An Investigation of Job Applications to Distressed Firms (2016, background): “Other recent papers also integrate labor economics and finance and focus on the use of leverage as a strategic input in the bargaining process between workers and firms (e.g., Matsa 2010; Chen, Kacperczyk, and Ortiz-Molina 2011; Benmelech, Bergman, and Enriquez 2012).”
Do Nonfinancial Stakeholders Affect the Pricing of Risky Debt? Evidence from Unionized Workers (2012, neutral): “Chen et al. (2009) show that unions also reduce firms’ operating flexibility and increase the required return on equity.”
Labor Mobility: Implications for Asset Pricing (2014, background): “For instance, if we assume that the CAPM holds and that the market portfolio follows the process dS t = S t μdt + S t σ dZ t , then the market price of risk would be given by η = μ−r σ and the traditional beta representation would be β CAPM = β σ .”
Does stock price informativeness affect labor investment efficiency (2016, methodology): “In line with Chen et al. (2007) and Ferreira et al. (2011), we use the Probability of Information trading (PIN) derived from Easely et al.”