Skip to main content
SpringerLink
Log in

Equity market response to union decertification petitions and elections

  • Articles
  • Published:
Journal of Labor Research Aims and scope Submit manuscript

Abstract

The effect of union decertification elections on the valuation of corporations is examined using a standard event study methodology. Cumulative abnormal daily common stock returns for 203 NYSE and AMEX listed firms are estimated for the day on which a petition for a decertification election is filed and for the day on which the National Labor Relations Board (NLRB) certifies the decertification election outcome. The results are consistent with the hypothesis that successful union decertifications increase firm valuation and unsuccessful ones reduce firm valuation. The primary carrier of valuation information is the date the NLRB confirms the decertification election results. The petition file date yields little, if any, information about the firm’s capitalization.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Log in via an institution

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Institutional subscriptions

Similar content being viewed by others

References

  • Brown, C. and J. Medoff. “Trade Unions in the Production Process.”Journal of Political Economy 86 (June 1978): 355–78.

    Article  Google Scholar 

  • Brown, S. and J. Warner. “Measuring Security Price Information.”Journal of Financial Economics 8 (September 1980): 205–58.

    Article  Google Scholar 

  • _____. “Using Daily Stock Returns: The Case of Event Studies.”Journal of Financial Economics 14 (March 1985): 3–31.

    Article  Google Scholar 

  • Clark, K. “The Impact of Unionization on Productivity: A Case Study.”Industrial and Labor Relations Review 33 (July 1980): 451–69.

    Article  Google Scholar 

  • Dodd, P. and J. Warner. “On Corporate Governance: A Study of Proxy Contests.”Journal of Financial Economics 11 (April 1983): 401–38.

    Article  Google Scholar 

  • Heneman, H. and M. Sandver. “Predicting the Outcome of Union Certification Elections: A Review of the Literature.”Industrial and Labor Relations Review 36 (July 1983): 537–59.

    Article  Google Scholar 

  • Hunt, J. and R. White. “The Effect of Management Practices on Union Election Returns.”Journal of Labor Research 6 (Fall 1985): 389–403.

    Article  Google Scholar 

  • Pruitt, S., K. C. Wei, and R. White. “The Impact of Union-Sponsored Boycotts on the Stock Prices of Target Firms.”Journal of Labor Research 9 (Summer 1988): 285–90.

    Article  Google Scholar 

  • Ruback, R. and M. Zimmerman. “Unionization and Profitability: Evidence from the Capital Market.”Journal of Political Economy 92 (December 1984): 1134–57.

    Article  Google Scholar 

  • Weston, J. and T. Copeland.Managerial Finance. New York: Dryden, 1986.

    Google Scholar 

Download references

Author information

Authors and Affiliations

  1. University of West Florida, 32514, Pensacola, FL

    William L. Huth

  2. University of North Texas, 76203, Denton, TX

    Don N. MacDonald

Authors
  1. William L. Huth
    View author publications

    You can also search for this author in PubMed Google Scholar

  2. Don N. MacDonald
    View author publications

    You can also search for this author in PubMed Google Scholar

Additional information

The authors thank the directors of the regional NLRB offices and the editor of this journal for their assistance. The usual caveats concerning errors and omissions apply. Correspondence should be directed to William L. Huth.

Rights and permissions

Reprints and permissions

About this article

Cite this article

Huth, W.L., MacDonald, D.N. Equity market response to union decertification petitions and elections. Journal of Labor Research 11, 193–201 (1990). https://doi.org/10.1007/BF02685387

Download citation

  • Issue Date:

  • DOI: https://doi.org/10.1007/BF02685387

Keywords

Search

Navigation