Employee incentives to make firm specific investment: Implications for resource-based theories of corporate diversification
We argue that the risk associated with the value of a firm's core resources has an impact on employee decisions to make firm-specific investments, independent of the threat of opportunism that might exist in a particular exchange. We further explore mechanisms firms may adopt to mitigate the em...
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Main Authors: | , |
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Format: | text |
Language: | English |
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Institutional Knowledge at Singapore Management University
2006
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Online Access: | https://ink.library.smu.edu.sg/lkcsb_research/3456 https://ink.library.smu.edu.sg/context/lkcsb_research/article/4455/viewcontent/Employee_Incentive_2006_pv.pdf |
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Institution: | Singapore Management University |
Language: | English |
Summary: | We argue that the risk associated with the value of a firm's core resources has an impact on employee decisions to make firm-specific investments, independent of the threat of opportunism that might exist in a particular exchange. We further explore mechanisms firms may adopt to mitigate the employee incentive problem stemming from the risk associated with core resource value. These arguments shed new light on resource-based theories of corporate diversification. |
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