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SSRN

Business Organizations Law

1997

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Lifetime Employment: Labor Peace And The Evolution Of Japanese Corporate Governance, Ronald J. Gilson, Mark J. Roe Jan 1997

Lifetime Employment: Labor Peace And The Evolution Of Japanese Corporate Governance, Ronald J. Gilson, Mark J. Roe

Faculty Scholarship

In Japan, large firms' relationships with their employees differ from those prevailing in large American firms. Large Japanese firms guarantee many employees lifetime employment, and the firms' boards consist of insider employees. Neither relationship is common in the United States. Japanese lifetime employment is said to encourage firms and employees to invest in human capital. We examine the reported benefits of the firm's promise of lifetime employment, but conclude that it is no more than peripheral to human capital investments. Rather, the 'dark' side of Japanese labor practice – constricting the external labor market – likely yielded the human capital benefits ...


Private Ownership And Corporate Performance: Some Lessons From Transition Economies, Roman Frydman, Cheryl W. Gray, Marek P. Hessel, Andrzej Rapaczynski Jan 1997

Private Ownership And Corporate Performance: Some Lessons From Transition Economies, Roman Frydman, Cheryl W. Gray, Marek P. Hessel, Andrzej Rapaczynski

Faculty Scholarship

Data on mid-sized firms in three transition economies provide strong evidence that private ownership – for worker ownership – improves corporate performance. And the privatized firms' superior ability to generate revenues allows those firms to sustain or expand employment.

Using a large sample of data on mid-sized firms in the Czech Republic, Hungary, and Poland, Frydman, Gray, Hessel, and Rapacynski compare the performance of privatized and state firms in the environment of the postcommunist transition.

They find strong evidence that private ownership – for worker ownership – improves corporate performance. They find no evidence of the privatization shock that was supposed to afflict the ...