How and Why Does Franchise Ownership Affect Human Resource Practices? Evidence from the US Hotel Industry

Tashlin Lakhani

ILR Review, 2022, vol. 75, issue 2, 321-347

Abstract: This study investigates the relationship between ownership form and human resource (HR) practices in a franchise system. Using data from a unique establishment-level survey of a US-based limited service hotel chain, the author examines how HR practices vary between franchisee- and company-owned hotels, and among franchisees with diverse ownership structures. Consistent with agency theory predictions of franchisee profit motives and free-riding behavior, franchisee-owned hotels are associated with lower investments in HR practices compared to company-owned hotels. The results of this study suggest that ownership structures influence HR investments.

Keywords: franchising; human resources; HPWPs; hotels; job quality; ownership; agency theory (search for similar items in EconPapers)
Date: 2022
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Persistent link: https://EconPapers.repec.org/RePEc:sae:ilrrev:v:75:y:2022:i:2:p:321-347

DOI: 10.1177/0019793920972661

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