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Be nice to your innovators: employee treatment and corporate innovation performance

journal contribution
posted on 01.08.2016, 00:00 authored by C Chen, Y Chen, P H Hsu, Edward PodolskiEdward Podolski
This paper investigates the effect that employee treatment schemes have on corporate innovation performance. We find that firms with better employee treatment schemes produce more and better patents through improving employee satisfaction and teamwork. Additional tests suggest that our main findings cannot be attributed to job security, unionization, reverse causality, and omitted variables. We also find that firms with better employee treatment schemes produce patents that enhance market valuation and facilitate better future operating performance. Collectively, our findings show that treating employees well benefits firms and shareholders, for well treated employees are encouraged to create intellectual property.

History

Journal

Journal of corporate finance

Volume

39

Pagination

78 - 98

Publisher

Elsevier

Location

Amsterdam, The Netherlands

ISSN

0929-1199

Language

eng

Publication classification

C1 Refereed article in a scholarly journal; C Journal article

Copyright notice

2016, Elsevier