Do Labor Unions Affect Income Smoothing Through R&D Management?

Ilhang Shin, Sorah Park

Research output: Contribution to journalArticlepeer-review

2 Scopus citations


Using the firm-level labor union data unique to Korea, this study examines the influence of labor unions on firms’ income smoothing activities through R&D expense adjustment. We show that unionized firms have greater extent of income smoothing through R&D adjustment, suggesting that labor unions impose pressure on management to smooth out fluctuation in earnings path. Also, we find evidence that the positive association between labor union and income smoothing via R&D expense is significant only for non-chaebol firms. These findings add to the existing literature on the impact of labor unions, one of important stakeholders, on firms’ accounting choices and financial reporting behavior.

Original languageEnglish
JournalEmerging Markets Finance and Trade
StateAccepted/In press - 2022

Bibliographical note

Publisher Copyright:
© 2022 Taylor & Francis Group, LLC.


  • chaebol
  • income smoothing
  • Korea
  • Labor union
  • M41
  • M43
  • R&D expense


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