The (non-) effect of labor unionization on firm risk: Evidence from the options market

Ghaly, Mohamed, Kostakis, Alexandros ORCID: 0000-0002-2358-6484 and Stathopoulos, Konstantinos (2021) The (non-) effect of labor unionization on firm risk: Evidence from the options market Journal of Corporate Finance, 66. p. 101816. ISSN 0929-1199, 1872-6313

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Abstract

Labor unionization has no causal effect on firm risk. Using a regression discontinuity design to study the impact of labor union elections on option-implied firm risk, we find that unionization per se does not affect investor perceptions about firm price, tail, or variance risk. This finding is robust to studying very short (5-trading day) and long (up to 2-year) windows around the elections. Moreover, there is no unionization effect on firm risk either in subsets of firms facing strong union bargaining power, or with characteristics that prior literature identifies as important determinants of the effect of unionization on firm outcomes.

Item Type:	Article
Uncontrolled Keywords:	Unionization, Labor power, Option-implied firm risk, Regression discontinuity design
Depositing User:	Symplectic Admin
Date Deposited:	12 Jan 2021 10:36
Last Modified:	01 Mar 2026 00:26
DOI:	10.1016/j.jcorpfin.2020.101816
Related Websites:	Author Publisher
URI:	https://livrepository.liverpool.ac.uk/id/eprint/3112041
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