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Dark side of investment in employee education in privately-held companies

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  • Li, Changhong
  • Li, Jialong
  • Wu, Zhenyu

Abstract

Using a sample of over half a million observations, we explore how investment in employee education affects cost of debt of privately held companies. Findings indicate that, although employee education does help enhance firm performance, it results in a higher cost of debt. However, this negative effect of employee education on cost of debt is weakened by better regional development.

Suggested Citation

  • Li, Changhong & Li, Jialong & Wu, Zhenyu, 2017. "Dark side of investment in employee education in privately-held companies," Finance Research Letters, Elsevier, vol. 22(C), pages 190-196.
    • Handle: RePEc:eee:finlet:v:22:y:2017:i:c:p:190-196
    DOI: 10.1016/j.frl.2016.12.023
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