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Distortion between Economic and Financial Performance. Does the Human Capital Matter?

Loredana Cultrera and Guillaume Vermeylen
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Loredana Cultrera: University of Mons - Warocqué School of Business and Economics, Belgium
Guillaume Vermeylen: University of Mons - Warocqué School of Business and Economics, Belgium

Expert Journal of Economics, 2017, vol. 5, issue 2, 53-61

Abstract: This paper focuses on and compares two specific definitions of performance: economic and financial, with the aim to provide evidence that supports the distinctions between both definitions. Relying on a Belgian sample consisting of 14,135 firms, our results show that one specific variable deserves to be questioned: the worker’s level of education. On one hand, it seems that the workers’ level of education has a positive impact on economic performance; namely, the more the firms hire highly educated workers, the more productive it is. On the other hand, it seems that the effect is entirely the opposite when the financial performance is taken into account. In this case, the more the firms rely on highly educated workers, the less it is performing in a competitive manner.

Keywords: Firm Performance; Panel data; Economic Performance; Financial Performance (search for similar items in EconPapers)
JEL-codes: G10 D22 D24 (search for similar items in EconPapers)
Date: 2017
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