NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

When Unions "Mattered": Assessing the Impact of Strikes on Financial Markets: 1925-1937

John DiNardo, Kevin F. Hallock

NBER Working Paper No. 7794
Issued in July 2000
NBER Program(s):   LS

Combining information from labor historians and using techniques from finance we analyze the strikes that labor historians have agreed are pivotal in American history' during the period 1925-1937. Using information we collected on strike dates and historical financial market stock price data we assess the financial market's view of these conflicts. We study the effects of major strikes between the world wars on detailed industry stock prices. We find that strikes have large, negative effects on industry stock value. We also find that longer strikes, violent strikes, strikes where unions win,' industry-wide strikes, strikes that lead to union recognition, and strikes that lead to large wage increases lead to larger negative share price reactions than other strikes. Also, our analysis shows that most of the news' in a strike seems to be incorporated very early on in the strike. Our analysis strongly suggests that although the financial markets generally expected unions to lose,' they viewed union victories as quite important determinants of the share of firm profits going to stockholders.

download in pdf format
   (276 K)

email paper

This paper is available as PDF (276 K) or via email.

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w7794

Published: John DiNardo & Kevin F. Hallock, 2002. "When unions "mattered": The impact of strikes on financial markets, 1925-1937," Industrial and Labor Relations Review, ILR Review, ILR School, Cornell University, vol. 55(2), pages 219-233, January.

Users who downloaded this paper also downloaded these:
Lee and Mas w14709 Long-Run Impacts of Unions on Firms: New Evidence from Financial Markets, 1961-1999
Card and Olson w4075 Bargaining Power, Strike Duration, and Wage Outcomes: An Analysis of Strikes in the 1880s
Baker w16846 Industrial Actions in Schools: Strikes and Student Achievement
 
Publications
Activities
Meetings
Data
People
About

Support
National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email: info@nber.org

Contact Us