【报告主题】Does Pay Transparency Among Employees Affect Product Recalls?
【主讲嘉宾】杨馨，中央财经大学会计学院助理教授
【报告时间】2024年3月12日 14:00
【报告地点】会计学院108室
【内容提要】
The push for pay transparency as a mechanism to promote fairness in employee compensation has recently gained momentum. In this study, we exploit the state-level staggered adoption of pay transparency laws to study how pay transparency affects firms’ product recalls. We find an increase in product recalls for firms headquartered in states adopting pay transparency laws,suggesting that pay transparency may result in reduced workforce quality and increased worker unhappiness and disharmony. Further supporting this theory is evidence that the increase in recalls is more pronounced for more labor-intensive firms, firms facing increased risk of losing key employees, and firms with greater risk of unhappiness among employees after pay transparency laws. Additional analysis reveals that pay transparency increases not only the likelihood but also the severity of product recalls. Last, we document that when pay transparency negatively impacts firms’ product quality, the firms’ future performance also suffers.