TABLE 1: Variable Definitions

Variable

Definition

Broad-based stock ownership > 50%

Firms where fifty percent or greater of non-management employees have been granted the right to purchase shares after a required vesting period  (dummy variable)

Ln (Employment)

Natural logarithm of total company employment (continuous)

Ln (Sales)

Natural logarithm of total company sales, adjusted for inflation with GDP deflator (continuous)

Ln (Capital Intensity)

Total property, plant, and equipment divided by total employment, with book values adjusted to current market value using GDP deflator and estimate of age of capital stock (continuous)

Ln (Productivity)

Natural logarithm of output per worker (total sales adjusted for inventory changes and inflation divided by the number of employees) (continuous)

Return on assets

[(Income minus adjusted depreciation) x 100]/(market value of capital stock + current assets – current assets – current liabilities) (continuous)

Tobin's q

(Market value + preferred stock + long term debt)/ (capital stock+current assets–current liabilities) (continuous)

(capital stock+current assets–current liabilities) (continuous)

Total shareholder return

(Stock price + adjusted dividend)[t]/stock price[t-1]  (adjusted for stock splits)(continuous)

Ln(labor costs per employee)

Natural logarithm of total labor expenses divided by number of employees

Industry controls

2-digit industry codes (dummy variables)