Abstract:

Using granular U.S. plant-level emissions data, we find that corporate emissions decline significantly when labor mobility increases, driven by weaker enforcement of covenants not to compete (CNCs) in the states where employees work. The effect is more pronounced for firms that rely more on highly skilled labor and intangible capital, operate in environments with a more mobile labor force, face fewer financial constraints, or are subject to greater external monitoring. Further, as labor mobility restrictions ease, firms increase their green innovation and investment while reducing toxic releases. Our results suggest that greater labor mobility enhances corporate environmental performance by boosting emission abatement activities, highlighting its broader environmental benefits.

Bio of the Speaker:

Dr. Tiancheng Yu is an Associate Professor (Special Term Associate Researcher) of Accounting at Wuhan University. Prior to his appointment at Wuhan University, he was a Lecturer in Finance at the University of Exeter. He completed his PhD at the University of Manchester. His research focuses on empirical corporate finance, climate finance, and labor finance. Dr. Yu has published several papers in top-tier journals, including Management Science and the British Journal of Management.