Abstract

We document that labor relationships at founder firms are less acrimonious than at non-founder firms. Founder-firms are less likely to be unionized and employees at non-unionized founder-firms are less likely to attempt to unionize. Further, among firms that are unionized, labor at founder-firms are less likely to strike. Finally, employees of founder firms are much less likely to file unfair labor practice complaints with the NLRB. These results also hold for firms that are run by the family members of founders. Unobserved heterogeneity does not appear to drive the results. The results reveal the valuable role of employee trust in founders.

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