Measuring Organizational Capital
AbstractFirms develop their organizational practices to realize returns from given and marketable resources. Implementing effective practices requires substantial up-front investment. We approximate the economic relevance of establishment-specific organizational capital by using a two-step procedure. First, we extract an establishment-specific performance differential from a within-panel estimator. Second, we explain the variation in this differential by using organizational and control variables. Our results make it possible for us to predict the contribution of organizational practices to the performance differential. We label this part of the firm-specific performance differential “organizational capital”. Our results indicate that organizational capital has a substantial impact on performance.
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Bibliographic InfoArticle provided by LMU Munich School of Management in its journal Schmalenbach Business Review.
Volume (Year): 61 (2009)
Issue (Month): 4 (October)
Managerial Economics; Organizational Capital; Organizational Design; Production Function;
Find related papers by JEL classification:
- D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
- L23 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Organization of Production
- M29 - Business Administration and Business Economics; Marketing; Accounting - - Business Economics - - - Other
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- Michael Beckmann & Dieter Kuhn, 2010. "Complementarities between Workplace Organisation and Human Resource Management:," Working papers 2010/03, Faculty of Business and Economics - University of Basel.
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