ABSTRACT This study explores how rising housing prices affect employee–employer conflict through the lens of employee lawsuits. Using a sample of Chinese listed firms from 2013 to 2019, we find that the likelihood of employee lawsuits against a firm increases with housing prices in the city where the firm is located. To establish causality, we employ a staggered difference‐in‐differences approach based on the implementation of home purchase restriction policies designed to curb housing price growth, and we also use land supply as an instrument for housing prices. Mechanism and cross‐sectional analyses show that psychological pressure can be the key mechanism driving employee lawsuits. Additional analyses demonstrate that housing price pressure leads to substantiated employee lawsuits instead of vexatious lawsuits. Also, it does not significantly increase other types of litigation, indicating that the psychological pressure primarily affects internal labor relations rather than external stakeholder disputes. These findings indicate that external cost‐of‐living pressures can erode workplace relations and escalate labor conflict. Overall, our paper provides novel evidence on how macroeconomic housing market conditions shape employee–employer dynamics and labor litigation.
Using annual data from 276 listed Chinese energy companies from 2009 to 2022, this study investigates the impact of climate policy uncertainty (CPU) on energy companies' product market performance (PMP). The results indicate that CPU significantly enhances enterprise performance in the product market, and subsequent analyses involving variable substitution, tail reduction, and the consideration of potential endogeneity issues confirm the robustness of this conclusion. Additionally, the moderating effects results indicate that among the four types of cross-border capital flows, cross-border capital direct investment and cross-border capital flows from other investments negatively moderate the CPU-PMP relationship, while the overall level of cross-border capital flows positively moderates the CPU-PMP relationship. Meanwhile, ESG performance and actions with R&D backgrounds positively moderate the CPU-PMP relationship. Moreover, the mediating effect test reveals that CPU influences energy companies' PMP primarily through enhancing technological innovation, alleviating financing constraints, improving the management incentive system, and reducing equity concentration. Lastly, heterogeneity results demonstrate that CPU has a more significant influence on the market performance of non-SOEs, large-scale enterprises, profitable companies, non-transparent companies, enterprises characterized by dispersed equity ownership, and regions with higher stabilization policy efficiency.
This paper investigates how managerial career concerns, shaped by external employment opportunities, influence asymmetric cost behavior. Prior research highlights that executives' labor market prospects significantly affect their decision-making, particularly under conditions of job insecurity. Leveraging the staggered adoption of the Inevitable Disclosure Doctrine (IDD) by U.S. state courts, which restricts CEOs' mobility by protecting trade secrets, we examine the causal impact of external employment constraints on corporate cost management strategies. Using a sample of U.S. firms from 1994 to 2022 and a difference-indifferences methodology, we find that cost stickiness significantly decreases following the recognition of the IDD. This reduction is more pronounced for firms led by younger CEOs, those with less internal authority, and firms operating in industries characterized by greater external employment opportunities or high R&D intensity. Our findings suggest that CEOs, facing heightened career concerns and restricted mobility, engage in more aggressive cost-cutting during sales downturns. Overall, this study provides novel evidence on how labor market frictions shape internal resource adjustment decisions.
This study examines the underexplored relationship between a firm's business strategy and executive compensation. While research has extensively analyzed the standard economic and governance determinants of executive pay, the causal role of an organization's overarching strategic posture remains unclear. Using a sample of 27,084 firm-year observations from 3,072 Chinese listed firms across 2005-2022, we examine how a composite measure of strategic aggressiveness affects executive compensation. Firms adopting aggressive prospector strategies pay executives significantly higher compensation than conservative defender firms do; this pattern is more significant for firms with high strategic differentiation, transparent disclosure, concentrated ownership, and intense industry competition. Enhanced executive human capital and innovative output act as mediating channels, indicating that boards use competitive compensation to align managerial incentives with strategic risks.
This study examines whether U.S. sanctions significantly impact the financing constraints of Chinese listed firms. Using a uniquely constructed dataset of Chinese A-share firms spanning the 2007 to 2021 period that were directly impacted by the U.S. sanctions, we provide strong evidence showing a positive relationship between sanctions and financing constraints. Additional analyses indicate that the positive relationship between sanctions and financing constraints is more (less) pronounced for firms with greater risk exposure (strong market position, strong innovation and research capabilities, and effective government support policies). Sanctions also increase the financing costs for affected firms, shorten their financing duration, and complicate their access to financing. Finally, various endogeneity tests and robustness checks confirm our baseline results. Overall, our study provides important insights into the detrimental effect of U.S. sanctions on Chinese firms' financing constraints.
