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Revisiting the relationship between firm strategic capabilities and productivity in a multilevel analysis: Do labor market conditions matter?

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  • Fernando Cárdenas Echeverri
  • Andres García-Suaza
  • Juan Esteban Garzon Restrepo

Abstract

This paper studies the relationship between managerial capital, social capital and firm productivity in Colombia, and explores whether this relationship depends on labor quality and formality. Results confirm a positive and significant effect of firm capabilities (managerial and social capital) on TFP (total factor productivity) and suggest a substitution effect between them. A positive effect of labor quality and formality on firm productivity is documented. Even though results are not conclusive, labor quality appears to increase the effect of managerial capital and reduce that for social capital, while labor formality seems to have no impact on their marginal effect. This is important for policy makers reinforcing the importance of quality education, labor formality and the relevance of programs promoting adoption of managerial practices and development of networks.

Suggested Citation

  • Fernando Cárdenas Echeverri & Andres García-Suaza & Juan Esteban Garzon Restrepo, 2023. "Revisiting the relationship between firm strategic capabilities and productivity in a multilevel analysis: Do labor market conditions matter?," Documentos de Trabajo 20641, Universidad del Rosario.
    • Handle: RePEc:col:000092:020641
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    More about this item

    Keywords

    Productivity; Managerial Capital; Social Capital; Labor formality; Developing countries;
    All these keywords.

    JEL classification:

    • L10 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - General
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
    • M21 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics - - - Business Economics
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General

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