Sangok Yoo, Suhyung Lee, Sehoon Kim, Soebin Jang, Daeyeon Cho
{"title":"Training and development investment and financial performance: The bidirectional relationship and the moderating effect of financial slack","authors":"Sangok Yoo, Suhyung Lee, Sehoon Kim, Soebin Jang, Daeyeon Cho","doi":"10.1002/hrdq.21449","DOIUrl":null,"url":null,"abstract":"<p>Research has not yet clearly demonstrated the relationship between training and development (TD) investment and financial performance. This study examines the bidirectional, non-linear, one-year-lagged relationship between TD investment and financial performance, and the moderating effect of financial slack on the relationship based on the resource-based view and the theory of slack resources. We analyze financial data of 174 firms in South Korea over 10 years (2009–2018) using a lagged dependent variable model. Our results demonstrate that TD investment contributes to later financial performance, and financial performance contributes to later TD investment. We find an inverted U-shaped relationship between TD investment and financial performance in both directions. Financial slack positively moderates the bidirectional relationship, such that the inverted U-shaped effect of TD investment on financial performance is more pronounced among those with low financial slack. In the effect of financial performance on TD investment, firms with high financial slack show a U-shaped curve, while firms with low financial slack show an inverted U-shaped curve. This study provides valuable information for human resource development scholars and practitioners about the relationship between TD investment and financial performance.</p>","PeriodicalId":47803,"journal":{"name":"Human Resource Development Quarterly","volume":null,"pages":null},"PeriodicalIF":4.0000,"publicationDate":"2021-06-22","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.1002/hrdq.21449","citationCount":"9","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Human Resource Development Quarterly","FirstCategoryId":"91","ListUrlMain":"https://onlinelibrary.wiley.com/doi/10.1002/hrdq.21449","RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q1","JCRName":"INDUSTRIAL RELATIONS & LABOR","Score":null,"Total":0}
引用次数: 9
Abstract
Research has not yet clearly demonstrated the relationship between training and development (TD) investment and financial performance. This study examines the bidirectional, non-linear, one-year-lagged relationship between TD investment and financial performance, and the moderating effect of financial slack on the relationship based on the resource-based view and the theory of slack resources. We analyze financial data of 174 firms in South Korea over 10 years (2009–2018) using a lagged dependent variable model. Our results demonstrate that TD investment contributes to later financial performance, and financial performance contributes to later TD investment. We find an inverted U-shaped relationship between TD investment and financial performance in both directions. Financial slack positively moderates the bidirectional relationship, such that the inverted U-shaped effect of TD investment on financial performance is more pronounced among those with low financial slack. In the effect of financial performance on TD investment, firms with high financial slack show a U-shaped curve, while firms with low financial slack show an inverted U-shaped curve. This study provides valuable information for human resource development scholars and practitioners about the relationship between TD investment and financial performance.
期刊介绍:
Human Resource Development Quarterly (HRDQ) is the first scholarly journal focused directly on the evolving field of human resource development (HRD). It provides a central focus for research on human resource development issues as well as the means for disseminating such research. HRDQ recognizes the interdisciplinary nature of the HRD field and brings together relevant research from the related fields, such as economics, education, management, sociology, and psychology. It provides an important link in the application of theory and research to HRD practice. HRDQ publishes scholarly work that addresses the theoretical foundations of HRD, HRD research, and evaluation of HRD interventions and contexts.