Finance Research Seminar –Dr Minh Nguyen

Title: Institutional Fund Liquidity, Corporate Labour Efficiency and Labour Productivity

Date: 20 November 2024

Time: 13:00 – 14:00

Venue: FDC.2.15

If you would like to attend, please register using the following link:

Institutional Fund Liquidity, Corporate Labour Efficiency and Labour Productivity

Speaker:  Dr Minh Nguyen

Dr Minh Nguyen, Newcastle University Business School https://www.ncl.ac.uk/business/people/profile/minhnguyen.html

Abstract:

We find that institutional fund illiquidity (henceforth fragility) increases labour investment inefficiency of U.S. firms over the sample period from Jan 1, 1994 to Dec 31, 2021. This relationship is stronger when illiquid institutional investors have long-term investment horizon in the firm, after the introduction of Regulation Fair Disclosure, during the 2007-8 financial crisis and periods of high financial and macroeconomic uncertainty and for firms with CEO duality, that is, CEO also serves as the chairman of the board of directors of the firm. Our empirical findings also show that institutional fund illiquidity has significant negative effect on labour productivity. This evidence suggests that the presence of fragile investors imposes real economic consequences on corporate performance via the channel of suboptimal labour investment decisions.