| dc.description.abstract | This thesis contains three empirical papers on labor unions and corporate cash holdings, payout policy. Previous literature about firms' financial choices, such as corporate cash holdings, dividend payouts, and share repurchases, has focused on the effects of firm-level financial characteristics. This thesis investigates whether labor unions affect these financial policies in the international settings. The second chapter examines the relation between the presence of labor unions and corporate cash holdings in the international setting. Firms in countries with higher union membership have less corporate cash holdings. This negative relation is stronger for firms in countries with weak employment protection legislation, firms in countries with a high degree of labor bargaining centralization, and financially constrained firms. Moreover, the market value of corporate cash holdings is lower for firms in countries with high union membership. The number of strikes and lockouts is higher in countries with more corporate cash holdings. It suggests that firms strategically choose corporate cash holdings to gain a bargaining position with labor in an international setting. The third chapter examines the relation between the presence of labor unions and firms' dividend payouts. Firms in countries with higher union membership have more dividend payouts. This positive relation is stronger for firms in countries with weaker employment protection legislation, firms in countries with a higher degree of labor bargaining centralization. Moreover, this chapter conducts a smaller sample analysis and find that the announcement return and operating performance around the date of dividend increases (decreases) are positively (negatively) related to the union membership. In addition, the number of strikes & lockouts is higher in countries with less corporate payout. It suggests that firms strategically payout dividend to gain the bargaining position with labor in the international setting. Chapter 4 examines the relation between the presence of labor unions and firms' share repurchases. Firms in countries with higher union membership have more share repurchases. This positive relation is stronger for firms in countries with weaker employment protection legislation, firms in countries with a higher degree of labor bargaining centralization. Similar with Chapter 2, this chapter finds that the announcement return and operating performance around the date of share repurchase are positively related to the union membership in small sample analysis. In addition, the number of strikes & lockouts is higher in countries with less share repurchases. It suggests that firms strategically increase share repurchases to gain the bargaining position with labor in the international setting. Overall, these results are consistent with the bargaining hypotheses and suggest that firms strategically make financial choices against labor unions all over the world. | en_GB |
