The Relationship Between Human Capital, Productivity and Market Value: Building Up from Micro Evidence

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IZA Seminar

Place: Schaumburg-Lippe-Str. 9, 53113 Bonn

Date: 02.10.2002, 12:15 - 13:30

   

Presentation by 

John C. Haltiwanger (University of Maryland)
   

Abstract:

This paper investigates and evaluates the direct and indirect contribution of human capital
to business productivity and shareholder value. The impact of human capital may occur
in two ways: the specific knowledge of workers at businesses may directly increase
business performance, or a skilled workforce may also indirectly act as a complement to
improved technologies, business models or organizational practices. Our general
approach is to use newly created firm level measures of workforce human capital and
productivity, and to then examine links between those measures and market value. The
new human capital measures come from an integrated employer-employee dataset being
developed at the US Census Bureau. We link these data to financial information from
Compustat at the firm level, which provides measures of market value and tangible
assets. The combination of these two sources permits examination of the link between
human capital, productivity, and market value.

   
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