Does employee welfare affect corporate debt maturity?

Sabri Boubaker, Lamia Chourou, Marwa Haddar and Taher Hamza

European Management Journal, 2019, vol. 37, issue 5, 674-686

Abstract: This study examines the effect of employee well-being on the corporate debt maturity structure of U.S. firms. It hypothesizes that a firm's degree of commitment to employee welfare affects its debt maturity structure. Using a sample of 19,347 firm-year observations over the period 1991–2014, we find evidence that firms with higher employee welfare scores prefer long-term debt over short-term debt. This relationship is more pronounced for firms operating in human-capital-intensive industries and firms with lower labor union-membership rate. Our findings are robust to endogeneity concerns and insensitive to the use of alternative regression methods, variable measurements, and sample compositions. This paper provides novel evidence on the role of employment policies and practices in explaining variations in debt maturity.

Keywords: Employee well-being; Employee welfare; Stakeholders; Debt maturity (search for similar items in EconPapers)
JEL-codes: G32 G34 M54 (search for similar items in EconPapers)
Date: 2019
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Citations: View citations in EconPapers (11)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:eurman:v:37:y:2019:i:5:p:674-686

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DOI: 10.1016/j.emj.2019.08.004

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