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

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  • Tashlin Lakhani

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.

Suggested Citation

  • Tashlin Lakhani, 2022. "How and Why Does Franchise Ownership Affect Human Resource Practices? Evidence from the US Hotel Industry," ILR Review, Cornell University, ILR School, vol. 75(2), pages 321-347, March.
    • Handle: RePEc:sae:ilrrev:v:75:y:2022:i:2:p:321-347
    DOI: 10.1177/0019793920972661
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    References listed on IDEAS

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    Cited by:

    1. Yoon, Chungeun, 2023. "Technology adoption and jobs: The effects of self-service kiosks in restaurants on labor outcomes," Technology in Society, Elsevier, vol. 74(C).

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