Bankruptcy and the Cost of Organized Labor: Evidence from Union Elections

• 成果类型: Article
• 署名作者: Campello, Murillo; Gao, Janet; Qiu, Jiaping; Zhang, Yue
• 署名单位: Cornell University; National Bureau of Economic Research; Indiana University System; Indiana University Bloomington; McMaster University; Universite Catholique Louvain
• 刊物名称: REVIEW OF FINANCIAL STUDIES
• ISSN/ISSBN: 0893-9454
• DOI: 10.1093/rfs/hhx117
• 发表日期: 2018
• 页码: 980
• 关键词: Financial distress; capital structure; CORPORATE-BONDS; unionization; RESOLUTION; impacts; claims; debt

摘要

Unionized workers are entitled to special treatment in bankruptcy court that can be detrimental to other corporate stakeholders, with unsecured creditors standing to lose the most. Using data on union elections, we employ a regression discontinuity design to identify the effect of worker unionization on bondholders in bankruptcy states. Closely won union elections lead to significant bond value losses, especially when firms approach bankruptcy, have underfunded pension plans, and operate in non-RTW law states. Unionization is associated with longer, more convoluted, and costlier bankruptcy court proceedings. Unions depress bondholders' recovery values as they are assigned seats on creditors' committees.