Labor Unions and Non-Shareholding Stakeholders

63 Pages Posted: 27 Oct 2020

See all articles by Mine Ertugrul

Mine Ertugrul

University of Massachusetts Boston

Dalia Marciukaityte

Illinois State University

Date Written: July 3, 2020


Using corporate social responsibility (CSR) scores, we examine the effect of unionization on non-shareholding stakeholders and the value of CSR for unionized firms. Our findings suggest that unionization leads to lower CSR. This negative relation between unionization and CSR is stronger for financially constrained firms. We address endogeneity issues by controlling for firm characteristics including firm fixed effects, examining a quasi-natural experiment, and using regression discontinuity design examining union certification elections. Unionized firms with lower CSR have better alignment of CEO and shareholder interests and higher market values than other unionized firms.

Keywords: labor unions, corporate social responsibility, non-shareholding stakeholders

JEL Classification: G32, G38

Suggested Citation

Ertugrul, Mine and Marciukaityte, Dalia, Labor Unions and Non-Shareholding Stakeholders (July 3, 2020). Available at SSRN: or

Mine Ertugrul

University of Massachusetts Boston ( email )

100 Morrissey Blvd
Boston, MA 02125
United States

Dalia Marciukaityte (Contact Author)

Illinois State University ( email )

Normal, IL 61790
United States

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