The Impacts of Romantic Relationships with the Boss

David C. Macdonald, Jerry Montonen and Emily E. Nix

No 34346, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Romantic relationships in the workplace are common, but those between managers and subordinates have increasingly drawn scrutiny. Using administrative data on the universe of cohabiting couples in Finland, we examine the career implications of starting or ending a personal relationship with a workplace manager and the spillovers of these relationships on the broader workforce. An event study design reveals that entering a relationship with a manager increases the subordinate's earnings by 6%, but breaking up triggers an abrupt 18% earnings decline. We also find that these relationships generate spillovers: retention of other workers declines by six percentage points, with effects concentrated in workplaces where subordinates experience greater earnings gains. Our findings highlight both the private benefits and organizational costs of hierarchical workplace relationships.

JEL-codes: J12 J15 M12 M14 (search for similar items in EconPapers)
Date: 2025-10
New Economics Papers: this item is included in nep-hrm and nep-lab
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