The Impact of IPOs on Workers
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Series
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Speaker(s)Ramin Baghai (Stockholm School of Economics, Sweden)
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FieldFinance
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LocationTinbergen Institute, room 1.61
Amsterdam -
Date and time
September 10, 2025
12:45 - 14:00
Abstract
We study how initial public offerings affect workers. Going public significantly impacts the relationship between firms and employees: firms raise salaries and offer more stable wages, especially to long-tenured workers. These changes in employment contracts affect household finances and family decisions. After an IPO, workers take on more investment risk and are more likely to purchase a home; they are also more likely to marry and have children. To identify these effects, we use stock market return variations during the book building period as an instrument for IPO completion.