The effect of labor unions on innovation and market valuation in business group affiliations: new evidence from South Korea
- 주제(키워드) Firm innovation , Korean chaebols , Labor union , R&D expenditures
- 등재 SSCI, SCOPUS
- 발행기관 Palgrave Macmillan Ltd.
- 발행년도 2020
- 총서유형 Journal
- URI http://www.dcollection.net/handler/ewha/000000168626
- 본문언어 영어
- Published As https://dx.doi.org/10.1057/s41291-019-00089-9
- 저작권 이화여자대학교 논문은 저작권에 의해 보호받습니다.
초록/요약
This paper examines how non-financial stakeholders, especially labor unions, affect firms’ innovation in business group affiliations. Using firm-level labor union data unique to Korea, we find that firms’ innovation activities are negatively related to unionization. This negative relationship is more pronounced for large business groups, suggesting that Korean chaebols are more concerned with the influence of powerful stakeholders—union workers. Also, equity market valuation of R&D reduction under union pressure is not negative for chaebol-affiliated firms, whereas it is negative for non-affiliated firms. These results indicate that the equity market perceives that chaebols’ internal capital market facilitates group-oriented R&D investment decisions. © 2019, Springer Nature Limited.
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