Human resource policies and firm innovation: The moderating effects of economic and institutional context

Sorin M.S. Krammer

Technovation, 2022, vol. 110, issue C

Abstract: This paper examines the effects of human resource (HR) policies on firm innovation. Specifically, I argue that firms who implement policies to stimulate job autonomy and performance-based pay will be more likely to innovate, as proxied by investments in R&D. In addition, I contend that the institutional (i.e., labour regulations) and competitive (i.e., pressure from imports) contexts in which a firm operates will affect the relationship between HR policies and innovation, albeit in different ways. These hypotheses are tested using a dataset of more than 900 firms across a heterogenous set of 12 countries, majority of which are emerging markets. I find strong empirical backing for the role of both job autonomy and performance-based pay policies in stimulating firm innovation, and partial support for the moderating effects of institutional and competitive contexts of this relationship.

Keywords: Human resource management; Job autonomy; Performance-based pay; Firm innovation; Labour regulations; Import competition (search for similar items in EconPapers)
Date: 2022
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Persistent link: https://EconPapers.repec.org/RePEc:eee:techno:v:110:y:2022:i:c:s0166497221001474

DOI: 10.1016/j.technovation.2021.102366

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