Document Type

Article

Publication Date

1-31-2023

Publication Title

Research in Labor Economics

Volume

52

Pages

1-35

Publisher Name

Emerald Group Publishing

Abstract

This paper presents new evidence on anti-competitive practices in the franchise sector. Drawing from a corpus of Franchise Disclosure Documents (FDDs) filed by 3,716 franchise brands in years 2011- 2023 (partial), I report new information on franchise brands’ use of inter-firm non-solicitation (“no poach”) clauses barring recruitment between firms, no hire clauses barring employment, and franchisor requirements that franchisees use employee non-compete clauses barring workers from joining competitors. Regulatory actions that restricted the enforceability of anti-competitive clauses began to appear in FDDs in 2018. While non-solicitation and no hire clauses have declined in use, the use of non-competes remained stable over time. While prior evidence on anti-competitive practices largely draws from individual complaints, survey data, and limited hand-coded samples, this paper spotlights new methods for finding barriers to worker mobility in large, unstructured text corpora.

Comments

Author Posting © The Author, 2023. This AAM is provided for your own personal use only. It may not be used for resale, reprinting, systematic distribution, emailing, or for any other commercial purpose without the permission of the publisher, Emerald Group Publishing. The definitive version of this article was published in Research in Labor Economics, Vol. 52 on January 31, 2023,https://dx.doi.org/10.2139/ssrn.4342586

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