IDEAS home Printed from https://ideas.repec.org/a/sae/ilrrev/v50y1996i1p60-79.html
   My bibliography  Save this article

Employee Stock Ownership and Corporate Performance among Public Companies

Author

Listed:
  • Joseph Blasi
  • Michael Conte
  • Douglas Kruse

Abstract

This study compares the corporate performance in 1990/91 of two groups of public companies: those in which employees owned more than 5% of the company's stock, and all others. The results of the analysis, which looks at profitability, productivity, and compensation, are consistent with neither negative nor highly positive views of employee ownership, but where differences are found, they are favorable to companies with employee ownership, especially among companies of small size. The circumstances in which employee ownership was used—specifically, whether it was part of a wage/benefit concession package and whether it was involved in a takeover threat—do not appear to have had a significant effect on the 1990 performance levels or 1980–90 performance growth of the firms. Although the authors caution that the data do not permit clear tests of causality, these results are broadly consistent with those of past studies.

Suggested Citation

  • Joseph Blasi & Michael Conte & Douglas Kruse, 1996. "Employee Stock Ownership and Corporate Performance among Public Companies," ILR Review, Cornell University, ILR School, vol. 50(1), pages 60-79, October.
    • Handle: RePEc:sae:ilrrev:v:50:y:1996:i:1:p:60-79
    DOI: 10.1177/001979399605000104
    as

    Download full text from publisher

    File URL: https://journals.sagepub.com/doi/10.1177/001979399605000104
    Download Restriction: no
    File URL: https://libkey.io/10.1177/001979399605000104?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Chris Doucouliagos, 1995. "Worker Participation and Productivity in Labor-Managed and Participatory Capitalist Firms: A Meta-Analysis," ILR Review, Cornell University, ILR School, vol. 49(1), pages 58-77, October.
    2. Drew Fudenberg & Eric Maskin, 2008. "The Folk Theorem In Repeated Games With Discounting Or With Incomplete Information," World Scientific Book Chapters, in: Drew Fudenberg & David K Levine (ed.), A Long-Run Collaboration On Long-Run Games, chapter 11, pages 209-230, World Scientific Publishing Co. Pte. Ltd..
    3. Douglas Kruse & Joseph Blasi, 1995. "Employee Ownership, Employee Attitudes, and Firm Performance," NBER Working Papers 5277, National Bureau of Economic Research, Inc.
    4. Ben Craig & John Pencavel, 1995. "Participation and Productiviy: A Comparison of Worker Cooperatives and Conventional Firms in the Plywood Industry," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 26(1995 Micr), pages 121-174.
    5. Kandel, Eugene & Lazear, Edward P, 1992. "Peer Pressure and Partnerships," Journal of Political Economy, University of Chicago Press, vol. 100(4), pages 801-817, August.
    6. Alchian, Armen A & Demsetz, Harold, 1972. "Production , Information Costs, and Economic Organization," American Economic Review, American Economic Association, vol. 62(5), pages 777-795, December.
    7. Bonin, John P & Jones, Derek C & Putterman, Louis, 1993. "Theoretical and Empirical Studies of Producer Cooperatives: Will Ever the Twain Meet?," Journal of Economic Literature, American Economic Association, vol. 31(3), pages 1290-1320, September.
    8. Kumbhakar, Subal C. & Dunbar, Amy E., 1993. "The elusive ESOP--productivity link : evidence from U.S. firm-level data," Journal of Public Economics, Elsevier, vol. 52(2), pages 273-283, September.
    9. Sangsoo Park & Moon H. Song, 1995. "Employee Stock Ownership Plans, Firm Performance, and Monitoring by Outside Blockholders," Financial Management, Financial Management Association, vol. 24(4), Winter.
    10. Jones, Derek C & Kato, Takao, 1995. "The Productivity Effects of Employee Stock-Ownership Plans and Bonuses: Evidence from Japanese Panel Data," American Economic Review, American Economic Association, vol. 85(3), pages 391-414, June.
    11. Douglas L. Kruse, 1993. "Profit Sharing: Does It Make a Difference?," Books from Upjohn Press, W.E. Upjohn Institute for Employment Research, number ps.
    12. Putterman, Louis & Skillman, Gil Jr., 1988. "The incentive effects of monitoring under alternative compensation schemes," International Journal of Industrial Organization, Elsevier, vol. 6(1), pages 109-119, March.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Gregory Dow, 2001. "Allocating Control over Firms: Stock Markets versus Membership Markets," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 18(2), pages 201-218, March.
    2. Han, Tzu-Shian & Shen, Chung-Hua, 2007. "The effects of bonus systems on firm performance in Taiwan's high-tech sector," Journal of Comparative Economics, Elsevier, vol. 35(1), pages 235-249, March.
    3. Joseph Blasi & Richard Freeman & Douglas Kruse, 2016. "Do Broad-based Employee Ownership, Profit Sharing and Stock Options Help the Best Firms Do Even Better?," British Journal of Industrial Relations, London School of Economics, vol. 54(1), pages 55-82, March.
    4. Derek C. Jones & Takao Kato, 2011. "The Impact of Teams on Output, Quality, and Downtime: An Empirical Analysis Using Individual Panel Data," ILR Review, Cornell University, ILR School, vol. 64(2), pages 215-240, January.
    5. Richard B. Freeman, 2008. "When Workers Share in Profits: Effort and Responses to Shirking," 'Angelo Costa' Lectures Serie, SIPI Spa, issue Lect. IX.
    6. Malleson, Tom, 2014. "After Occupy: Economic Democracy for the 21st Century," OUP Catalogue, Oxford University Press, number 9780199330102.
    7. Douglas L. Kruse & Joseph R. Blasi & Rhokeun Park, 2010. "Shared Capitalism in the U.S. Economy: Prevalence, Characteristics, and Employee Views of Financial Participation in Enterprises," NBER Chapters, in: Shared Capitalism at Work: Employee Ownership, Profit and Gain Sharing, and Broad-based Stock Options, pages 41-75, National Bureau of Economic Research, Inc.
    8. Joseph R. Blasi & Richard B. Freeman & Christopher Mackin & Douglas L. Kruse, 2010. "Creating a Bigger Pie? The Effects of Employee Ownership, Profit Sharing, and Stock Options on Workplace Performance," NBER Chapters, in: Shared Capitalism at Work: Employee Ownership, Profit and Gain Sharing, and Broad-based Stock Options, pages 139-165, National Bureau of Economic Research, Inc.
    9. Joseph Blasi & Richard Freeman & Douglas Kruse, 2004. "Monitoring Colleagues at Work: Profit-Sharing, Employee Ownership, Broad-Based Stock Options and Workplace Performance in the United States," CEP Discussion Papers dp0647, Centre for Economic Performance, LSE.
    10. Arando, Saioa & Gago, Monica & Jones, Derek C. & Kato, Takao, 2011. "Efficiency in Employee-Owned Enterprises: An Econometric Case Study of Mondragon," IZA Discussion Papers 5711, Institute of Labor Economics (IZA).
    11. Geert Braam & Erik Poutsma, 2015. "Broad-Based Financial Participation Plans and Their Impact on Financial Performance: Evidence from a Dutch Longitudinal Panel," De Economist, Springer, vol. 163(2), pages 177-202, June.
    12. Douglas L. Kruse, 1993. "Does Profit Sharing Affect Productivity?," NBER Working Papers 4542, National Bureau of Economic Research, Inc.
    13. Philip Mellizo & Jeffrey Carpenter & Peter Hans Matthews, 2014. "Workplace democracy in the lab," Industrial Relations Journal, Wiley Blackwell, vol. 45(4), pages 313-328, July.
    14. Kornelius Kraft & Julia Lang, 2016. "Just a Question of Selection? The Causal Effect of Profit Sharing on a Firm's Performance," Industrial Relations: A Journal of Economy and Society, Wiley Blackwell, vol. 55(3), pages 444-467, July.
    15. Artz, Georgeanne M. & Kim, Younjun, 2011. "Business ownership by workers: are worker cooperatives a viable option?," ISU General Staff Papers 201111090800001098, Iowa State University, Department of Economics.
    16. Dow, Gregory K. & Putterman, Louis, 2000. "Why capital suppliers (usually) hire workers: what we know and what we need to know," Journal of Economic Behavior & Organization, Elsevier, vol. 43(3), pages 319-336, November.
    17. Ansgar Richter & Susanne Schrader, 2017. "Levels of Employee Share Ownership and the Performance of Listed Companies in Europe," British Journal of Industrial Relations, London School of Economics, vol. 55(2), pages 396-420, June.
    18. Richard B. Freeman & Joseph R. Blasi & Douglas L. Kruse, 2010. "Introduction to "Shared Capitalism at Work: Employee Ownership, Profit and Gain Sharing, and Broad-based Stock Options"," NBER Chapters, in: Shared Capitalism at Work: Employee Ownership, Profit and Gain Sharing, and Broad-based Stock Options, pages 1-37, National Bureau of Economic Research, Inc.
    19. Jeffery Carpenter & Samuel Bowles & Herbert Gintis, 2006. "Mutual Monitoring in Teams: Theory and Experimental Evidence on the Importance of Reciprocity," Middlebury College Working Paper Series 0608, Middlebury College, Department of Economics.
    20. repec:eee:labchp:v:3:y:1999:i:pb:p:2373-2437 is not listed on IDEAS
    21. James C. Sesil & Yu Peng Lin, 2011. "The Impact of Employee Stock Option Adoption and Incidence on Productivity: Evidence from U.S. Panel Data," Industrial Relations: A Journal of Economy and Society, Wiley Blackwell, vol. 50(3), pages 514-534, July.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sae:ilrrev:v:50:y:1996:i:1:p:60-79. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: SAGE Publications (email available below). General contact details of provider: http://www.ilr.cornell.edu .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.