Board-Level Employee Representation and Firms' Responses to Crisis

Aleksandra Gregoric, Marc Steffen Rapp

Publikation: KonferencebidragPaperForskning

Resumé

We hypothesize that companies with board level employee representation (BLER) should experience a lower probability of crisis-induced dismissals than other firms. Theoretically, we link this effect to the employee directors’ ability to reduce the in-formation asymmetry and moral hazard in employee-employer contracting, thereby facilitating the implementation of labor-cost adjustments that are an alternative to workforce dismissals. We confirm our hypotheses by analyzing the behavior of Scandinavian public corporations with/without employee directors during the Great Recession. We show that BLER associates with significantly lower performance-sensitivity of employment cuts during the crisis period. In these firms, the lower likelihood of employment reductions was in part ensured through alternative measures providing for a reduction of the labor costs per employee.
OriginalsprogEngelsk
Publikationsdato2018
Antal sider30
StatusUdgivet - 2018
BegivenhedIZA Workshop on the Economics of Employee Representation: International Perspectives - IZA - Institute of Labor Economics, Bonn, Tyskland
Varighed: 7 sep. 20188 sep. 2018
http://conference.iza.org/conference_files/EmRep_2018/viewProgram?conf_id=3147

Workshop

WorkshopIZA Workshop on the Economics of Employee Representation
LokationIZA - Institute of Labor Economics
LandTyskland
ByBonn
Periode07/09/201808/09/2018
Internetadresse

Emneord

  • Industrial relations
  • Board of directors
  • Employee directors
  • Employment
  • Labor costs
  • Great Recession

Citer dette

Gregoric, A., & Rapp, M. S. (2018). Board-Level Employee Representation and Firms' Responses to Crisis. Afhandling præsenteret på IZA Workshop on the Economics of Employee Representation, Bonn, Tyskland.
Gregoric, Aleksandra ; Rapp, Marc Steffen. / Board-Level Employee Representation and Firms' Responses to Crisis. Afhandling præsenteret på IZA Workshop on the Economics of Employee Representation, Bonn, Tyskland.30 s.
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Gregoric, A & Rapp, MS 2018, 'Board-Level Employee Representation and Firms' Responses to Crisis' Paper fremlagt ved IZA Workshop on the Economics of Employee Representation, Bonn, Tyskland, 07/09/2018 - 08/09/2018, .

Board-Level Employee Representation and Firms' Responses to Crisis. / Gregoric, Aleksandra; Rapp, Marc Steffen.

2018. Afhandling præsenteret på IZA Workshop on the Economics of Employee Representation, Bonn, Tyskland.

Publikation: KonferencebidragPaperForskning

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AU - Rapp, Marc Steffen

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AB - We hypothesize that companies with board level employee representation (BLER) should experience a lower probability of crisis-induced dismissals than other firms. Theoretically, we link this effect to the employee directors’ ability to reduce the in-formation asymmetry and moral hazard in employee-employer contracting, thereby facilitating the implementation of labor-cost adjustments that are an alternative to workforce dismissals. We confirm our hypotheses by analyzing the behavior of Scandinavian public corporations with/without employee directors during the Great Recession. We show that BLER associates with significantly lower performance-sensitivity of employment cuts during the crisis period. In these firms, the lower likelihood of employment reductions was in part ensured through alternative measures providing for a reduction of the labor costs per employee.

KW - Industrial relations

KW - Board of directors

KW - Employee directors

KW - Employment

KW - Labor costs

KW - Great Recession

KW - Industrial relations

KW - Board of directors

KW - Employee directors

KW - Employment

KW - Labor costs

KW - Great Recession

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Gregoric A, Rapp MS. Board-Level Employee Representation and Firms' Responses to Crisis. 2018. Afhandling præsenteret på IZA Workshop on the Economics of Employee Representation, Bonn, Tyskland.