Market valuation of firm investments in training and human capital management

摘要

The relationship between a firm’s human capital management and its performance is a topic of growing interest in recent years. With the increasing role of technology and the rapid innovations in many industries, having highly skilled and knowledgeable employees is often necessary for success. Firms make these investments in training and education, along with implementing various policies regarding employee involvement, improvement, satisfaction, and retention with the expectation that they will result in positive economic performance. This dissertation examines the economic value to firms of investing in the training of their employees. The primary research questions are: (1) whether firms benefit, financially, from investments in training and human capital, and (2) if firms do benefit, what are the firm-level factors that affect how much they benefit? This dissertation contributes to the growing management literature on human capital by providing empirical tests that firm investments in human capital have a positive impact on economic performance, and by identifying firm-level factors that are complementary to these human capital investments. To conduct these empirical tests, I first use event study methodology to obtain a measure of the economic impact of information regarding a firm’s human capital management investments and policies. Subsequent regression analyses are then used to test hypotheses regarding possible complementary relationships between firm-level factors and its human capital investments. Results of the event study provide robust support that training matters; significant abnormal returns are found at appropriate event windows for investments in human capital. Subsequent analysis of the abnormal returns offers some but not unqualified support for the complementarity of investments in advertising, physical capital, and R&D as explaining the return to human capital.