Is Public Equity Deadly? Evidence from Workplace Safety and Productivity Tradeoffs in the Coal Industry

Abstract

We study how public listing status relates to the balance between workplace safety and labor productivity. Theory offers competing hypotheses on how listing-related frictions may affect this tradeoff. We exploit asset-level data in the U.S. coal industry and find that workplace safety deteriorates under public firm ownership, primarily in mines that experience the largest productivity increases. The tradeoff towards higher productivity and poorer workplace safety for public firms is concentrated when information asymmetry problems between managers and shareholders are likely exacerbated, and when the transition to public ownership occurs in communities where the prior private owner had stronger local ties.

Keywords: Public listing status, workplace safety, risk-taking, productivity, tradeoffs, ESG

JEL Classification: G30, G32, G34, J24, J38