Abstract: We study how corporate philanthropy affects employee retention and productivity, using comprehensive resume data from a popular professional networking website. Using large natural disasters as shocks to the demand for disaster relief to identify exogenous variation in corporate charitable giving, we show that corporate philanthropy significantly reduces employee turnover by 5.9% to 7.8%. The effect is distinct from other CSR activities, and more pronounced for employees with volunteering experience and for female and younger employees, even within the same firm and year. Our findings indicate that an alignment in values between workers and firms can increase employee commitment.
Discussant: Bo Bian, University of British Columbia
Abstract: Using resume data on over 20 million U.S. workers, we find that the flow of employees between a pair of firms sharply drops by about 20% when the firms start to share a director on their boards. We find no trend prior to initiation, and the reduced flow persists throughout the overlapping period. This relationship is stronger in settings where firms are more likely to benefit from lower competition for each other’s employees and is most pronounced for higher-skilled employees. The results suggest that shared directors facilitate cooperative behavior in the labor market
Discussant: Anya Mkrtchyan, University of Massachusetts-Amherst
Qiping Xu, University of Illinois-Urbana-Champaign
Abstract: We examine how access to financing affects the racial pay gap inside U.S. firms using data from the Census Bureau and worker resumes. Exploiting exogenous shocks to firms’ debt capacity, we find that better access to financing significantly narrows the earnings gap between minority and white workers, both in dollar amount and relative pay rank. The effect is stronger for mid- and high-skill workers and for firms with worse diversity practices ex-ante. Following the shock, minority workers are more often promoted and reassigned to technology-oriented occupations. Taken together, access to finance makes firms better utilize minority workers’ human capital.
