Employee Satisfaction, Firm Value and Firm Productivity
AbstractWe examine whether self-reported employee satisfaction is associated with higher firm valuation and productivity. Using a sample of firms from Fortune magazine’s list of "100 Best Companies to Work For", companies in which employees report high levels of satisfaction, we find that these firms have valuations that are significantly greater than both their respective industry medians and matched firms. The firms in our sample also exhibit greater levels of productivity and efficiency. Thus, successful efforts in increasing employee satisfaction appear to enhance overall firm productivity, which is subsequently rewarded by investors through higher equity values.
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Bibliographic InfoPaper provided by University of Central Missouri, Department of Economics & Finance in its series Working Papers with number 0806.
Length: 23 pages
Date of creation: May 2008
Date of revision: May 2008
Employee satisfaction; firm value; firm productivity;
Find related papers by JEL classification:
- G30 - Financial Economics - - Corporate Finance and Governance - - - General
- G12 - Financial Economics - - General Financial Markets - - - Asset Pricing
- J41 - Labor and Demographic Economics - - Particular Labor Markets - - - Labor Contracts
This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-05-10 (All new papers)
- NEP-BEC-2008-05-10 (Business Economics)
- NEP-CFN-2008-05-10 (Corporate Finance)
- NEP-EFF-2008-05-10 (Efficiency & Productivity)
- NEP-HAP-2008-05-10 (Economics of Happiness)
- NEP-LAB-2008-05-10 (Labour Economics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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