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Human capital efficiency and firm performance across sectors in an emerging market

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  • Ngoc Phu Tran
  • Duc Hong Vo

Abstract

Human capital is considered the cornerstone of any progress in economic growth and development for any country. Vietnam and other emerging markets are no exception. One effect of human capital efficiency on firm performance is considered in various empirical studies. However, the examination of this efficiency on firm performance in Vietnam and other emerging markets has largely been ignored in the current literature, in particular with the use of a value-added intellectual coefficient (VAIC) model, which has been widely used to measure the value added generated by tangible and intangible assets. This paper is conducted to examine the contribution of human capital efficiency to firm performance across 12 sectors in the Vietnamese economy for the period 2011 to 2018. The generalized method of moments (GMM) technique is used in this paper. Empirical results in this paper strongly confirm that human capital efficiency makes a positive contribution to firm performance across sectors in Vietnam. In addition, the findings in this paper indicate that the banking sector does not have the highest level of human capital accumulation as previously thought. In the context of the Vietnamese economy, the level of human capital efficiency varies across sectors and the oil and gas and energy sectors are the best at human capital efficiency. We outline the policy implications from our findings in this study.

Suggested Citation

  • Ngoc Phu Tran & Duc Hong Vo, 2020. "Human capital efficiency and firm performance across sectors in an emerging market," Cogent Business & Management, Taylor & Francis Journals, vol. 7(1), pages 1738832-173, January.
    • Handle: RePEc:taf:oabmxx:v:7:y:2020:i:1:p:1738832
    DOI: 10.1080/23311975.2020.1738832
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    Cited by:

    1. Md. Mominur Rahman & Bilkis Akhter, 2021. "The impact of investment in human capital on bank performance: evidence from Bangladesh," Future Business Journal, Springer, vol. 7(1), pages 1-13, December.
    2. Ass. Prof ORBUNDE Benshima & Ass. Prof ARUMONA Jonah & AKINTOYE Olufemi Temidayo, 2023. "Intangible Asset Investment and Business Sustainability of Deposit Money Banks in Nigeria," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 7(5), pages 1792-1812, May.
    3. Robert Zenzerović & Danijela Rabar & Ksenija Černe, 2023. "A Longitudinal Analysis of Economic Activities’ Relative Efficiency Using the DEA Approach," Economies, MDPI, vol. 11(11), pages 1-14, November.
    4. Monika Barak & Rakesh Kumar Sharma, 2024. "Does intellectual capital impact the financial performance of Indian public sector banks? An empirical analysis using GMM," Palgrave Communications, Palgrave Macmillan, vol. 11(1), pages 1-11, December.
    5. AlQershi, Nagwan & Saufi, Roselina Binti Ahmad & Ismail, Noor Azizi & Mohamad, Mohd Rosli Bin & Ramayah, T. & Muhammad, Nik Maheran Nik & Yusoff, Mohd Nor Hakimin Bin, 2023. "The moderating role of market turbulence beyond the Covid-19 pandemic and Russia-Ukraine crisis on the relationship between intellectual capital and business sustainability," Technological Forecasting and Social Change, Elsevier, vol. 186(PB).
    6. Seema Miglani & Victoria Obeng, 2023. "Gender Diversity and Human Capital Efficiency in Australian Institutions: The Moderating Role of Workforce Environment Quality," JRFM, MDPI, vol. 16(7), pages 1-26, July.
    7. Lawrence Arokiasamy & Takemi Fujikawa & Shishi Kumar Piaralal & Thilageswary Arumugam, 2023. "A systematic review of literature on Human capital investment and its significance for human resource development," International Journal of System Assurance Engineering and Management, Springer;The Society for Reliability, Engineering Quality and Operations Management (SREQOM),India, and Division of Operation and Maintenance, Lulea University of Technology, Sweden, vol. 14(5), pages 1810-1826, October.
    8. Adamu Jibir & Musa Abdu & Abdullahi Buba, 2023. "Does Human Capital Influence Labor Productivity? Evidence from Nigerian Manufacturing and Service Firms," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 14(2), pages 805-830, June.
    9. Panduru Dan Andrei & Simion Petronela Cristina & Ioanid Alexandra, 2024. "Measuring Operational Efficiency: A Functional Analysis of Core and Non-Core Activities in a Leading Romanian Oil and Gas Retail Company," Proceedings of the International Conference on Business Excellence, Sciendo, vol. 18(1), pages 1335-1347.
    10. Mahmoud Lari Dashtbayaz & Amjed Hameed Mezher & Khalid Haitham Khalid Albadr & Bashaer Khudhair Abbas Alkafaji, 2023. "The Relationship between Intellectual Capital and Audit Fees," JRFM, MDPI, vol. 16(2), pages 1-28, February.
    11. Salem Gheit, 2022. "A Stochastic Frontier Analysis of the Human Capital Effects on the Manufacturing Industries’ Technical Efficiency in the United States," Athens Journal of Business & Economics, Athens Institute for Education and Research (ATINER), vol. 8(3), pages 215-238, July.

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