Effect Of Human Capital Research Articles

Climate change and the European banking sector: the effect of green technology adaptation and human capital

PurposeClimate change poses effect on banking sector’s risks and profitability through adaptation of green technology. This study aims to incorporates green technology adaptation in three sectors: green banking, green entrepreneurial innovation (EI) and green human resource (HR), in a model of bank’s performance. And determines the impact of climate change on bank risk and profitability.Design/methodology/approachAn assessment of profitability and risk profile of commercial banks is done for 27 European countries for 2013–2022, employing a two-step difference system-generalized method of moments estimation technique with a moderate effect of climate change by including interaction between climate change and green technology adaptation.FindingsThe results indicate that green banking increases profitability, reduces credit risk and increases liquidity risk. The results also show that green human resource increases profitability and becomes a source of credit and liquidity risks for the banks. Green EI increases credit risk and liquidity risk, while the effects of green EI on profitability vary with the use of two proxies: Green patents increase profitability and environment, social and corporate governance (ESG) scores decrease profitability.Practical implicationsSupportive government initiatives, including subsidies and tax rebates to green borrowers, may take the burden of green transition off the banking sector.Originality/valueThis paper observes the impact of green technology adaptation in three sectors: banks, EI and HR, moderated by climate change, adding substantially to the existing literature in conceptual framework and methodology.

Spatial wage disparities and human capital externalities in France

AbstractWe re‐examine the respective role of local density and local concentration of human capital in the agglomeration gains for about 750,00 individuals working in 304 commuting zones of metropolitan France over the period 2009–2015. Agglomeration gains are mostly driven by human capital effects over this period. Also, because it absorbs dynamic learning effects, the use of worker fixed effects to address spatial sorting of individuals may underestimate, by about two third, the wage premium with respect to local concentration of human capital over a midterm period. Finally, wage gaps stem more from differences in human capital in the private sector than in the public sector. We do not find evidence of a multiplier effect of public employment on local human capital externalities in the private sector.

Study on the impact of green finance on green total factor productivity in forestry—evidence from China

China's forestry industry's ecological, economic, and social benefits have improved significantly. However, practical problems remain, such as irrational industrial structure, serious resource consumption, and low environmental transformation efficiency. The green total factor productivity is an important index to measure the transformation of economic development mode, and improving the green total factor productivity in forestry is of great significance in guiding the transformation of forestry economy, improving the structure of agricultural economy, and realizing the green development of forestry economy. Based on the panel data of 30 provinces and cities in China from 2006 to 2021, this article adopts the entropy value method and the Global Malmquist–Luenberger index based on the SBM directional distance function to construct the index system of green finance and forestry green total factor productivity and empirically analyzes the impact and mechanism of green finance on forestry green total factor productivity. It was found that 1) green finance can improve local forestry green total factor productivity and influence the neighboring regions to improve forestry green total factor productivity through economic spillover effect, and the coefficient of spatial spillover effect was 0.1041. 2) There were regional differences in the impact of green finance on forestry green total factor productivity, which was explicitly presented as a gradual decrease from east to west “ladder-like”. 3) There was a 30.46% intermediary effect of forestry industry structure in the influence of green finance on forestry green total factor productivity. 4) There was a double-threshold effect of human capital in the influence of green finance on forestry green total factor productivity, and there was a non-linear effect of marginal increment in the influence of green finance on forestry green total factor productivity after the threshold of 5.87 human capital. Based on China's ecological and economic development background, it was significant to utilize green finance to solve forestry economic development problems and promote China's green and sustainable development, and therefore put forward policy recommendations.

The Impact of Transformational Leadership, Transactional Leadership, and Knowledge Management on Innovation Mediated by Human Capital in The Pharmaceutical Industry in Indonesia

The objective of this research is to find out how transformational leadership, transactional leadership, and knowledge management impact innovation mediated by human capital in the Pharmaceutical Industry in Indonesia. Quantitative analysis was conducted using Partial Least Squares - Structural Equation Modeling (PLS-SEM) utilizing SmartPLS 4 software. An online questionnaire was carried out to obtain the data and the responses from 203 respondents resulted in 186 usable from 30 pharmaceutical industries across Indonesia. The findings point out that the direct effects of transformational leadership (TL), transactional leadership (TC), knowledge management (KN), and human capital (HC) relate positively and significantly to innovation (IN). The findings also confirmed that human capital mediates partially (complementary) the effect of transformational leadership on innovation, transactional leadership on innovation, and knowledge management on innovation. Based on this study to optimize innovation performance, it was suggested that pharmaceutical companies in Indonesia need to maintain the performance of any indicators that are already running well, and also need to put more effort into knowledge exchange among employees as well as the level of using new methods to improve efficiency and effectiveness of existing processes.

Does institutional quality moderate the human capital–inequality dynamics? Comparative evidence from LAC and SSA countries

AbstractAligning with Sustainable Development Goal 10, this study probes whether quality institutions matter in the drive towards reducing income inequality through human capital. An unbalanced panel data on the Gini index (measure of income inequality), human capital index and institutional quality index drawn across 83 Latin America and sub‐Saharan African (SSA) countries from 2010 to 2019 is used. For the most part, the consensus is that the interaction of human capital and quality institutions significantly reduces income inequality. For context, inequality reduces by −7.810 and −21.30 points for the full and SSA samples. Other findings reveal that the interaction effect is consistently negative at upper quantiles. Evidence from the margin plots reveals that the effect of human capital on inequality improves as institutional quality is strengthened. The downward trend of the plot within the 95% confidence interval shows that institutional quality enhances the impact of human capital on income inequality for the full sample and in SSA. This is a novel contribution to the literature as it suggests that quality institutions matter in the drive towards reducing the menace of income inequality. Policy recommendations are discussed.

How does economic growth impact environmental quality in Ethiopia? A non‐linear approach

AbstractFueled by economic growth, among other factors, environmental degradation is one of the most serious challenges facing humanity in the twenty‐first century. Although extensive research has been conducted on the relationship between economic growth and environmental quality, the findings are inconclusive. This study investigated the relationship between economic growth and environmental quality in Ethiopia from 1981 to 2016 using non‐linear autoregressive distributive lag and two‐step least squares models. First, the study finds that the relationship between economic growth and environmental quality is asymmetric. Second, economic growth negatively affects environmental quality. Third, the positive environmental effect of a negative shock on economic growth is stronger than that of a positive shock. Fourth, energy consumption and population growth negatively affect environmental quality, whereas the effects of renewable energy consumption, natural resources, trade openness and human capital are positive. Fifth, an inverted N‐shaped relationship exists between economic growth and environmental quality, where GDP per capita greater than $686.770 contributes to environmental quality. Therefore, high and sustainable economic growth, renewable energy consumption, population control, resource conservation, trade openness and human capital accumulation are required to improve the environmental quality of Ethiopia. The limitation of this study is that it examines the direct impact of economic growth on environmental quality. It would be better to examine the potential indirect impact of economic growth via variables, such as institutional quality and human capital.

Digital infrastructure and innovation in Africa: Does human capital mediates the effect?

While both theory and empirical evidence have established the critical role of digital infrastructure in promoting innovation, there needs to be more understanding of factors mediating this nexus, especially from the African context, which is understudied. This paper argues that digital infrastructure spurs innovation, but the overall effect depends on countries’ level of human capital. Relying on data from 28 African countries spanning 2011–2019 and the system Generalized Method of Moment (GMM) estimator, this study departs from the extant literature by examining the synergistic effect of digital infrastructure and human capital on innovation while placing much emphasis on the multidimensional measurement approach of digital infrastructure. The results show a positive relationship between digital infrastructure and innovation in Africa. Furthermore, the interactive effect of digital infrastructure and human capital is significantly related to innovation, implying that digital infrastructure can indirectly enhance innovation through human capital accumulation. To promote innovation, the study recommends that policies that improve digital infrastructure should be pursued simultaneously with policies that enhance human capital.

The effect of human capital on organizational performance in the service industry 4.0: Mediation analysis from Indonesia

The service industry is currently facing the era of Industry 4.0, which results in an increasing need for talents who master information and technology to increase company productivity. Innovation is one of the strategies that service companies need to improve in order to compete with other companies. Organizational learning is also a company’s effort that is used to determine and meet the increasingly diverse needs of consumers to improve company performance. This study aims to investigate the role of innovation and organizational learning as mediating variables between human capital and organizational performance. The sample consisted of 305 managers in the service industry of Indonesia using a purposive sampling technique, with the minimum sample size determined using GPower software. Data were collected using a self-reported questionnaire distributed online via a Google form. Furthermore, data were analyzed using structural equation modeling partial least squares with the SmartPLS 3 software. The results reveal that human capital significantly affects organizational performance, innovation, and organizational learning. Then, innovation and organizational learning have a significant effect on organizational performance. Furthermore, innovation and organizational learning act as mediators between human capital and organizational performance. These findings shed new light of the importance of effective human capital management in improving organizational performance. Furthermore, innovation and organizational learning are variables that can bridge the two relationships in the service industry. AcknowledgmentsThis study is funded by the Indonesia Endowment Fund for Education, Ministry of Finance of the Republic of Indonesia.

Going out and bringing in: Exploring the impact of OFDI on green innovation performance under firms' digital transformation strategies

AbstractUnder the digital transformation strategy, whether the overseas investment activities of firms can achieve reverse green spillover is significant to their implementation of green and low‐carbon transformation. Accordingly, we examined the impact of outward foreign direct investment (OFDI) on green technology innovation (GTI) in parent firms under the digital transformation strategy at the micro‐level using a zero‐inflated negative binomial regression (ZINB) model with data from Chinese A‐share listed firms for 2000–2021. The study shows that (1) OFDI is beneficial to the growth of the parent firm's GTI. The results of both the instrumental variables approach and robustness tests support the baseline findings. (2) The scale, competitive, and human capital effects are the three micro‐mechanisms through which OFDI drives GTI. (3) Digital transformation has a positive moderating effect on OFDI and GTI, implying that digital transformation reinforces the reverse green spillover effect of OFDI. (4) The results of heterogeneity analysis show that state‐owned firms and firms with overseas executives have a more outstanding contribution of OFDI to GTI, and the moderating effect of digital transformation is more significant. This study provides micro‐level theoretical and empirical experiences on the green innovation effects of firms' digital transformation and overseas investment strategies.

Mediating role of leadership and group capital between human capital component and sustainability of horticultural agribusiness institutions in Indonesia

Abstract Farmers’ institutions are currently more cultural and primarily oriented only to getting government facilities. Farmers’ institutions have not been directed at utilizing access to various technological information, capital, and markets needed to develop horticultural agribusiness. Nevertheless, almost all farmers’ institutions exist in rural areas, but not all existing institutions can survive and carry out their functions sustainably. The research objective was to examine the impact of human capital through leadership and group capital on the sustainability of horticultural agribusiness institutions. The study was carried out at Uluere District, Bantaeng Regency, which is designated as a horticulture agribusiness development zone in South Sulawesi, Indonesia. The sample selection was conducted using a simple randomized method, where 10% of the overall population was chosen. This method resulted in a sample size of 233 respondents for this study. The data gathering was done during September and November of 2022. Moreover, to acquire findings about the effect of human capital on the long-term viability of institutional agribusiness horticulture, we conducted an analysis using the Structural Equation Modeling (SEM) method. The findings indicated that individual capability, individual motivation, organizational climate, and workgroup effectiveness were key factors of human capital that directly impact institutional strengthening. These factors were found to have positive and statistically significant connections. In addition, leadership and group capital connected the many aspects of human capital to the sustainability of horticultural agribusiness. The results of this study will significantly enhance ongoing efforts to formulate a plan aimed at mitigating rural development challenges, especially in Indonesia.

How important is a high-performance work system to improve branch-level performance?

PurposeThis study aims to propose and empirically examine the simultaneous complementary mediating role of bank branch collective human capital and justice climate between implemented high-performance work system (HPWS) and bank branch performance in the banking sector.Design/methodology/approachData were collected at three different intervals of time between March 2022 to July 2022 from a final sample of 323 branch managers and 1,369 employees of commercial banks operating in Pakistan. Partial least square structural equation modeling was used to test the theoretical model proposed by this study.FindingsStudy results revealed that collective human capital and justice climate simultaneously mediate the relationship between implemented HPWS and branch performance.Research limitations/implicationsThe study contributes to the strategic HRM theory by proposing the complementary mediating roles of human capital and organizational justice to reap the benefits of implementing HPWS for improving branch-level performance. The managers should focus on developing and exploiting the knowledge, skills and experiences (human capital) of branch employees and improve their collective perceptions of justice to reap the benefits of HPWS for enhancing branch-level performance.Originality/valueDrawing upon the resource-based view of the firm and organizational justice theory, this novel study examines the simultaneous and complementary mediating effects of collective human capital and justice climate between implemented HPWS and branch performance relationships at the branch-level analysis.

Minimum wage standard adjustment and employment: Heterogeneity effects on the human capital investment

Considerable debate has arisen around the potential effects of increasing the minimum wage on employment. This study aims to analyze the impact of changes in China's minimum wage standard on employment. The research utilises the canonical model method and constructs a regression model based on standard labor economics theory. The analysis is conducted using sample data from Chinese industrial enterprises between 2000 and 2007. Regression analysis is performed by categorizing enterprises based on their level of human capital investment. The findings indicate that minimum wage increases have a non-linear impact on employment, when seen from the standpoint of human capital investment. When the level of human capital investment is low, an increase in the minimum wage standard leads to a decrease in employment; when the level of human capital investment is high, an increase in the minimum wage standard leads to an increase in employment. According to the findings, the reason for this is that, investments in human capital can improve business profitability, increase worker marginal productivity, and increase labor demand. Similarly, the employment effect of a change in the minimum wage is positive in regions with high levels of human capital investment due to the externality effect of human capital. Adjustments to the minimum wage have a negative impact on employment in areas of the country with low levels of human capital investment. This demonstrates that changing the minimum wage does not result in a simple increase or decrease in total employment. The level of investment in human capital within the organization and the region is an important factor in determining the type and magnitude of the impact.

Examining the influence of entrepreneurial skills, human capital, and home country institutions on firm internationalization

AbstractIn an increasingly interconnected world, understanding the factors that influence firm internationalization is crucial for businesses and policymakers alike. This study examines the complex interplay between entrepreneurial skills, human capital, institutional environments and firm internationalization. Specifically, it investigates the mediating role of home country institutional environments in the relationship between entrepreneurial skills, human capital and firm internationalization. Based on a theoretical framework that integrates resource‐based and institutional theories, this study employs a quantitative research design, using cross‐sectional international data from the Global Entrepreneurship Development Institute (GEDI) and Global Competitiveness Index 2018 reports for 137 countries. The findings of this reveal compelling insights into the factors driving firm internationalization. Both direct and indirect effects of entrepreneurial skills and human capital on firm internationalization emerge as positive and statistically significant. Moreover, the study underscores the nuanced influence of institutional environments, indicating their partial mediation of the relationship between entrepreneurial skills, human capital and firm internationalization. This sheds light on the pivotal role of the dynamic interplay between resources and institutional frameworks in shaping firms’ strategic decisions to venture into foreign markets. The implications of these results extend beyond academia, with actionable insights for both businesses and policymakers alike. This study not only contributes to our theoretical understanding of internationalization processes but also provides practical guidance for firms seeking to navigate and optimize their global expansion strategies.

The impact of digital infrastructure on provincial green innovation efficiency-empirical evidence from China.

In the epoch of the digital economy, technological innovation and energy conservation are significantly facilitated by digital infrastructure, leading to substantial improvements in green innovation efficiency at the provincial level. This study employed the feasible generalized least square (FGLS) method to examine the effects of digital infrastructure on the green innovation efficiency across 30 provinces in the Chinese mainland, utilizing panel data from 2011 to 2020. Additionally, this investigation delves into the intervening role of industrial structure upgrading and the amplifying effects of environmental regulation and human capital on the process. Findings indicate that, to begin with, digital infrastructure contributes to the meaningful enhancement of green innovation efficiency within provinces. Subsequently, the industrial structure upgrading partially mediates the impact of digital infrastructure on the efficiency of provincial green innovation. Lastly, both human capital and environmental regulations amplify the beneficial influence of digital infrastructure on the effectiveness of green innovation at the provincial level. This study provides valuable insights into the mechanisms through which digital infrastructure boosts green innovation efficiency, aiding policymakers in formulating appropriate policies to augment digital infrastructure, thereby promoting provincial green innovation efficiency.

The effect of human capital, employee performance on work process improvement and employee performance on work productivity on sustainable competitive advantage in Thai banks

The effect of human capital, employee performance on work process improvement and employee performance on work productivity on sustainable competitive advantage in Thai banks

Effect of Human Capital and Information Capital Readiness on Business Sustainability: Do Market Orientation and Business Performance Matter?

COVID-19 pandemic has been threatening the sustainability of companies in Indonesia. Various policies and restrictions have caused a significant decline in sales and led to bankruptcy. As the major players in the national economy, the micro, small, medium enterprises (MSMEs) are encouraged to focus on their survival and sustainability. Survey method is done to examine the direct effect of human capital readiness and information capital readiness on business sustainability. It investigates whether the relationship is sequentially mediated by market orientation and business performance. Online questionnaires were distributed to 347 owners/managers of Indonesian manufacturing MSMEs in the East Java Province, Indonesia. PLS-SEM equation modeling was employed to test the hypotheses. Result shows that human capital readiness and information capital readiness positively affect business sustainability, and business performance does not mediate the effect of human capital readiness on business sustainability. Most important finding reveals that market orientation and business performance sequentially mediate the human capital readiness-business sustainability relationship. Market orientation and business performance sequentially mediate information capital readiness-business sustainability relationship. This study contributes to the development of resource-based view (RBV) by providing the empirical result on the important internal resources on sustainability. This brings practical awareness to the owners/managers of Indonesian MSMEs on increasing their market orientation to enhance their business performance and to guarantee their business sustainability. Practically, this research has important implications for achieving business sustainability as it offers a way for practitioners to improve business sustainability by utilizing human capital readiness, information capital readiness, market orientation, and business performance.

Contingency perspective to bridge human capital perception to achieve ambidexterity in environmental dynamism

Environmental change and technological disruption are expanding phenomena impacting today's economic world. A dynamic business environment can inspire companies to engage in both exploitative and exploratory innovation at the same time. Traditional financial technologies have evolved substantially over the past decade. Although the environment challenges technology to adapt to business sustainability, artificial intelligence has not replaced human bankers. There is, however, a scarcity of research on the relationship between ambidextrous work and human capital, indicating that few studies have been undertaken. To better understand how banks can achieve such organizational ambidexterity, we develop a framework that investigates the combined effects of organizational human capital (O-HC), environmental dynamism (END), and technological capacity (TEC) on organizational ambidexterity (ORA). The theory of contingency is the theoretical foundation of the subject. This quantitative analysis used a sample size of sixty-three executives from Indonesia's banking industry and was analyzed using PLS-SEM and SPSS to determine the measurement and structural models. The results show that TEC and O-HC directly affected ORA, but END did not. We also found that firms with O-HC are more likely to utilize high TEC to promote ORA. The findings of this study provide practitioners with insight into how they can promote human capital and TEC as pillars of ambidextrous banking. This research contributes to the literature on ORA and offers managers insights on aligning their knowledge practices to develop TEC when pursuing ORA.

Influential factors shaping the adoption and utilization of audit technology (CAATS) in the audit practices in Saudi Arabia: Human capital expertise as a moderating factor

This study examines the moderating effect of trained human capital on the associations of accounting information systems, generalized auditing software, and technology adoption with the performance of external auditors among Saudi listed companies. This study used a survey-based methodology. The final sample consisted of 136 responses with an 8% response rate. Using Smart-PL4 analysis, the results showed that there is a positive correlation between accounting information systems and external auditors. Conversely, a negative relationship between generalized auditing software and external auditors has been documented. In addition, this study reported a negative association between technology adoption and external auditors. However, the results highlight the positive relationship between trained human capital and external auditors. Overall, this study provides valuable insights for accounting and auditing policymakers on how external auditors’ performance is influenced by several factors in the Saudi audit market.

The impact mechanism of population growth and shrinkage on urban economic resilience: Based on the moderating effects of industrial structure and human capital

The impact mechanism of population growth and shrinkage on urban economic resilience: Based on the moderating effects of industrial structure and human capital

Effects of Structural, Relational and Human Capital on Entrepreneurship and Innovation in Colombian Micro and Small Software Companies

Effects of Structural, Relational and Human Capital on Entrepreneurship and Innovation in Colombian Micro and Small Software Companies