The Labor Market Impact of Shareholder Power: Worker-Level Evidence
* 주관: 서울대학교 경제학부, 경제연구소 한국경제혁신센터, SSK, BK21
* 본 세미나는 BK21+(2023-1학기) 세미나 참석으로 인정됩니다.
- 세미나 참석인정을 원하는 학생은 세미나 종료 후 참석자 명단을 작성해주시기 바랍니다.
Using worker-level data from the US Census Bureau’s LEHD program from 1993 through 2015, we show that shareholder power leads to large earnings losses for workers. We track the earnings of employees up to five years after their firms experience a material increase in ownership by block institutional shareholders, relative to employees of other firms that experience a similarly-sized increase in ownership by diffused institutional shareholders. We find that over the next six years, the cumulative earnings of the affected employees decline by 10% of their pre-event annual earnings on average. Workers with “high skills” (such as those with earnings in the top tercile) and top managers (such as chief executives) bear the brunt of the negative impact, with cumulative earnings declining by 16% and 63%, respectively. In contrast, the increased shareholder power does not affect earnings of employees with relatively low pay. We also find that concentrated institutional ownership does not affect employee departures, suggesting that worker reallocation may not be the main channel underlying the earnings losses. The collection of evidence is consistent with concentrated ownership increasing shareholders’ bargaining power, which in turn reduces workers’ rents.