Human capital consists of sets or bundles of general knowledge, skills, abilities, and other attributes (KSAOs). When KSAO sets are aligned with an organization’s production technology, specific human capital emerges. Alignment is achieved through matching activities. Specificity is a necessary but insufficient condition for firm-specificity: Uniqueness, labor market frictions, matching capabilities, and luck may lead to quasi firm-specific human capital. Quasi firm-specific human capital potentially leads to sustained competitive advantage; but the conversion is bound to assumptions, and is less likely to occur than often assumed.
Ingo Weller and Barry Gerhart
This chapter discusses methodological challenges in doing empirical quantitative research on HRM and effectiveness in the field of comparative human resource management (HRM). In particular, attention is paid to the challenges of adopting an appropriate level of analysis and of inferring causality in studying the HRM_effectiveness link. The authors provide examples of how to handle methodological problems when working with quantitative data, including advice on fixed-effects models and conducting quasi-experiments in comparative HRM studies.