Corruption disclosure and its impact on labour‐related actions

Abstract Our paper aims to explore the profound impact of corruption‐related injustices on organized labour actions. Focusing on China's anti‐corruption campaign, we utilize a city–month panel and a difference‐in‐differences approach to identify the causal impact of corruption disclosure on labour collective actions. Our findings indicate a significant increase in labour unrest incidents following each additional reported investigation of governmental officials. Further analysis reveals that this impact is not driven by sophisticated governmental tolerance or repression of collective actions, but is particularly pronounced in non‐state‐owned enterprises compared to their state‐owned counterparts. The mechanisms through which the negative impact of corruption disclosure on labour unrest occurs include a negative impact of corruption disclosure on inequality perceptions and trust in government, as well as detrimental effects on the profitability and operation of employers.