Two Essays on Corporate Finance Wang, Bo Finance Corporate Governance Employee Compensation Innovation Private Firms Social Capital Unionization This dissertation is comprised of two essays on finance. In the first chapter, I investigate whether and to what extent unionization would influence the compensation to the non-executive employees. In the second chapter, I explore how social capital would impact regional innovation performance by private firms.In the first chapter, I examine the effects of unionization on stock options granted to non-executive employees. Adopting a regression discontinuity design, I find that employees receive more stock options after the union election wins. The positive association is more pronounced when unions have more bargaining power and when free-riding problems are less severe. Further, I provide evidence that employees receive more stock options when CEOs are entrenched. Finally, I show that stock options provide risk-taking incentives to non-executive employees. This work provides a potential explanation to the union wage premium puzzle that unions utilize stock options to increase non-executive employees’ total compensation. In the second chapter, I investigate whether and to what extent social capital may affect regional innovation by private firms in the U.S. I document that regional social capital is positively associated with the quantity, quality, and novelty of county-level innovation by private firms. This effect is more prominent in regions with a lower supply of financial capital. My findings further suggest that social capital is complementary to investment in research and development. Using a Spatial Durbin Model, I report that regional social capital has significant spillover effects in boosting the innovation of neighboring counties. Wang, Haizhi 2021 Dissertation application/pdf islandora:1011792 http://hdl.handle.net/10560/islandora:1011792 Illinois Institute of Technology SSB / Stuart School of Business en In Copyright http://rightsstatements.org/page/InC/1.0/ Restricted Access