International Journal of Advanced Culture Technology

The International Promotion Agency of Culture Technology (국제문화기술진흥원)
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The Effects of Human Resource Factors on Firm Efficiency: A Bayesian Stochastic Frontier Analysis

  • Shin, Sangwoo (Solbridge International School of Business, Woosong University) ;
  • Chang, Hyejung (Department of Management, Kyung Hee University)
  • Received : 2018.11.20
  • Accepted : 2018.11.30
  • Published : 2018.12.31
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Abstract

This study proposes a Bayesian stochastic frontier model that is well-suited to productivity/efficiency analysis particularly using panel data. A unique feature of our proposal is that both production frontier and efficiency are estimable for each individual firm and their linkage to various firm characteristics enriches our understanding of the source of productivity/efficiency. Empirical application of the proposed analysis to Human Capital Corporate Panel data enables identification and quantification of the effects of Human Resource factors on firm efficiency in tandem with those of firm types on production frontier. A comprehensive description of the Markov Chain Monte Carlo estimation procedure is forwarded to facilitate the use of our proposed stochastic frontier analysis.

Keywords

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Figure 1. Shares of firm type variables

E1GMBY_2018_v6n4_292_f0002.png 이미지

Figure 2. Description of HR factors

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Figure 3. First-stage estimates

Table 1. Descriptive statistics for output and input variables (Unit: Korean billion won)

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Table 2. Estimates of second-stage production frontier parameters

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Table 3. Estimates of second-stage inefficiency parameters

E1GMBY_2018_v6n4_292_t0003.png 이미지

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