Human Resource Management Policies and Productivity: New Evidence from an Econometric Case Study

Type of Work

Article

Date

Winter 2006

Journal Title

Oxford Review of Economic Policy

Journal ISSN

0266-903X

Journal Volume

22

Journal Issue

4

First Page

526

Last Page

538

DOI

10.1093/oxrep/grj031

Abstract

First we distinguish various approaches used by economists to assess the impact of human resource management practices on productivity and then we briefly review and illustrate studies that represent different approaches. In the main part of the paper we illustrate the econometric case study method, by using new data to analyse a case from retail trade and by emulating an approach used in an earlier study. Consistent with theory we find that when employees have opportunities to participate, and to receive appropriate information and pertinent rewards, a one standard deviation increase of the first principal component score would increase productivity by 1 per cent. Our findings imply that there are benefits to innovative work practices, even in settings where employees do simple tasks and employees are relatively low-skilled. Since our findings are similar to those contained in a previous study, our results also indicate the value of replication studies.

Notes

JEL Classification: L81, M12, M54

Hamilton Areas of Study

Economics

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