When labor has a voice in corporate governance
By: Olubunmi Faleye, Vikas Mehrotra, Randall Morck.
Contributors: Mehrotra, Vikas C., 1963-; Morck, Randall.; National Bureau of Economic Research.
Series: NBER working paper series ;; working paper 11254; Working paper series (National Bureau of Economic Research : Online) ;; working paper no. 11254.
Publisher: National Bureau of Economic Research
Published: 2005
Place of publication: Cambridge, MA
Language: eng
Format: Electronic resource
Subjects: Employee ownership.; Corporate governance.; Management -- Employee participation.
Description: "Equity ownership gives labor both a fractional stake in the firm's residual cash flows and a voice in corporate governance.  Relative to other firms, labor-controlled publicly-traded firms deviate more from value maximization, invest less in long-term assets, take fewer risks, grow more slowly, create fewer new jobs, and exhibit lower labor and total factor productivity.  We therefore propose that labor uses its corporate governance voice to maximize the combined value of its contractual and residual claims, and that this often pushes corporate policies away from, rather than towards, shareholder value maximization"--National Bureau of Economic Research web site.
Notes: Includes bibliographical references.
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Mode of access: World Wide Web.