We further show both a dominant CEO and powerful labor are correlated to long-term firm performance, as well as short-term market valuations. Our results also demonstrate that both CEO and labor power affects to their share of profits. The economic effects of multiple unionism 283 A whole range of other pertinent issues were cited by respondents. If now, in addition, the union imposes a protective tariff on im ports from non-union countries, then new import-competing industries might be created within the union. Using the sample of US firms, we observe that the probability of outsourcing is positively related to CEO power and negatively associated with labor power. ment that economic integration may improve the productive efficiency of existing industries. This paper develops a theoretical rationale for the power between the CEO and labor, and empirically examines the extent to which outsourcing decisions and its outcomes depend on CEO power and labor participation in major corporate decisions. From the very beginning, unionization materially lowered employment in the auto and steel industries, and union. Additionally, the employment- population ratio and the unemployment rate have been adversely affected by the presence of unions. output by significant amounts trillions of dollars over time. Yet without outsourcing, the firm may lose out competitively and labor may lose even more. Using a variety of statistical techniques, we conclude that labor unions have reduced U.S. However, to make it happen, the CEO must negotiate with labor that may resist outsourcing because of its concern for jobs. Fundamentally, outsourcing may be potentially desirable because of cost saving and the value of flexibility. We attempt to explore the power play between the CEO and labor in a special type of corporate restructuring - outsourcing. Prior studies of CEO power have mostly focused on internal corporate governance as the balance of CEO power but neglected the effect of labor.
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