Employment Protection and Venture Capital Investment: The Impact of Wrongful Discharge Laws

被引：1
作者：
Wang, Wei [1 ]
Yung, Chris [2 ]
机构：
[1] Cleveland State Univ, Monte Ahuja Coll Business, Cleveland, OH 44114 USA
[2] Univ Virginia, McIntire Sch Commerce, Charlottesville, VA 22904 USA
来源：
MANAGEMENT SCIENCE | 2024年
关键词：
wrongful discharge laws; venture capital; difference-in-differences; LABOR UNEMPLOYMENT-INSURANCE; FIRING COSTS; ENTREPRENEURSHIP; GOVERNANCE; BANKRUPTCY; NEWNESS; WILL;
D O I：
10.1287/mnsc.2023.01936
中图分类号：
C93 [管理学];
学科分类号：
12 ; 1201 ; 1202 ; 120202 ;
摘要：
Wrongful discharge laws (WDLs) provide limits to the employment-at-will doctrine, and thus impair operating flexibility, increasing expected financial distress costs by making it costly to fire employees. This impairment is detrimental to start-ups, leading to a decline in venture capital (VC) investment. Using a difference-in-differences framework enabled by the staggered adoption of WDLs across the U.S. states, we show VC investment declines after a state adopts the good faith exception (the strongest form of WDL). This decline is most pronounced in sectors with high labor dependency.
引用
收藏
页码：1523 / 1545
页数：24
相关论文
共 71 条
  • [1] Can a wrongful discharge statute really benefit employers?
    Abraham, SE
    [J]. INDUSTRIAL RELATIONS, 1998, 37 (04): : 499 - 518
  • [2] Wrongful Discharge Laws and Innovation
    Acharya, Viral V.
    Baghai, Ramin P.
    Subramanian, Krishnamurthy V.
    [J]. REVIEW OF FINANCIAL STUDIES, 2014, 27 (01) : 301 - 346
  • [3] Labor unemployment risk and corporate financing decisions
    Agrawal, Ashwini K.
    Matsa, David A.
    [J]. JOURNAL OF FINANCIAL ECONOMICS, 2013, 108 (02) : 449 - 470
  • [4] Newness and novelty: Relating top management team composition to new venture performance
    Amason, AC
    Shrader, RC
    Tompson, GH
    [J]. JOURNAL OF BUSINESS VENTURING, 2006, 21 (01) : 125 - 148
  • [5] [Anonymous], 1965, Handbook of Organizations, DOI DOI 10.1016/S0742-3322(00)17019-6
  • [6] Patent trolls and startup employment
    Appel, Ian
    Farre-Mensa, Joan
    Simintzi, Elena
    [J]. JOURNAL OF FINANCIAL ECONOMICS, 2019, 133 (03) : 708 - 725
  • [7] Bankruptcy Law and Entrepreneurship
    Armour, John
    Cumming, Douglas
    [J]. AMERICAN LAW AND ECONOMICS REVIEW, 2008, 10 (02) : 303 - 350
  • [8] Does employment protection reduce productivity? Evidence from US states
    Autor, David H.
    Kerr, William R.
    Kugler, Adriana D.
    [J]. ECONOMIC JOURNAL, 2007, 117 (521) : F189 - F217
  • [9] The costs of wrongful-discharge laws
    Autor, David H.
    Donohue, John J., III
    Schwab, Stewart J.
    [J]. REVIEW OF ECONOMICS AND STATISTICS, 2006, 88 (02) : 211 - 231
  • [10] The employment consequences of wrongful-discharge laws: Large, small, or none at all?
    Autor, DH
    Donohue, JJ
    Schwab, SJ
    [J]. AMERICAN ECONOMIC REVIEW, 2004, 94 (02) : 440 - 446
12345678