Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/185109 
Year of Publication: 
2018
Series/Report no.: 
IZA Discussion Papers No. 11649
Publisher: 
Institute of Labor Economics (IZA), Bonn
Abstract: 
How valuable is work experience with advocacy groups, e.g. Greenpeace, for new hires of innovative firms? We integrate strategic human capital with stakeholder theory and suggest that this experience creates scarce human capital (knowledge, skills, abilities) facilitating innovations acceptable and legitimate for stakeholders such as regulators or residents. We argue that such human capital is complementary to firm resources and leads to a value surplus. Individuals with advocacy group work experience can subsequently appropriate at least parts of that surplus through higher salaries. Using matched data for 10,303 employees in Denmark, we find that new hires of innovative firms with advocacy group human capital enjoy salary premiums which are stronger in mature and technologically concentrated firms. Our findings have important implications for HR decision making.
Subjects: 
resource complementarity
advocacy groups
scarce human capital
stakeholder theory
value creation and capture
JEL: 
J24
J6
C21
Document Type: 
Working Paper

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