Dae‐Hyun Kwon

This study investigates whether employee characteristics are associated with corporate risk‐taking activities. The analysis shows that employee tenure is negatively associated with corporate risk‐taking. This association remains robust to the instrumental variable approach and propensity score matching method. Furthermore, the negative relation between employee tenure and corporate risk is stronger for firms offering lower wages and for more labor‐intensive firms. Overall, this study highlights the importance of considering the interaction between managers and stakeholders such as employees when understanding corporate risk‐taking.