Employee mobility, noncompete agreements, product-market competition, and company disclosure

• 成果类型: Article
• 署名作者: Aobdia, Daniel
• 署名单位: Northwestern University
• 刊物名称: REVIEW OF ACCOUNTING STUDIES
• ISSN/ISSBN: 1380-6653
• DOI: 10.1007/s11142-017-9425-z
• 发表日期: 2018
• 页码: 296-346
• 关键词: voluntary disclosure; discretionary disclosure; corporate disclosures; knowledge spillovers; localized knowledge; labor mobility; industry; decisions; QUALITY; POLICY

摘要

This study explores the impact on companies' disclosures of U.S. states' different propensities to enforce noncompete agreements. I find a negative association between a state's enforcement of noncompete agreements and disclosure activities of firms headquartered in that state. Companies that face local rivals drive some results. Analyses that focus on several state-level changes in enforcement level of noncompete agreements confirm this association. Overall, the findings are consistent with a higher enforcement of noncompete agreements increasing proprietary costs of disclosure, because companies in high-enforcement settings are less informed about each other due to reduced information leakage from employee transfers across competitors. The results suggest that the overall environment for information spillovers surrounding a firm impacts its degree of disclosure to the capital markets and that state-specific enforcement of noncompete agreements can be used as a novel measure of the proprietary costs of disclosure.