Political environment, employee tenure security and firm performance in middle-income economies
Purpose – The study investigates the effect of political instability and employee tenure security on the performance of firms in middle-income economies (MIEs) after controlling for the influence of corruption, international quality certification, external auditor services and firm age. It examines...
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| Format: | Article |
| Language: | English |
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Emerald Publishing
2023-08-01
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| Series: | Journal of Economics and Development |
| Subjects: | |
| Online Access: | https://www.emerald.com/insight/content/doi/10.1108/JED-06-2022-0105/full/pdf |
| _version_ | 1797742294936322048 |
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| author | Nicholas Addai Boamah Francis Ofori-Yeboah Kingsley Opoku Appiah |
| author_facet | Nicholas Addai Boamah Francis Ofori-Yeboah Kingsley Opoku Appiah |
| author_sort | Nicholas Addai Boamah |
| collection | DOAJ |
| description | Purpose – The study investigates the effect of political instability and employee tenure security on the performance of firms in middle-income economies (MIEs) after controlling for the influence of corruption, international quality certification, external auditor services and firm age. It examines whether ownership and sector effects matter in the explored relationships. Design/methodology/approach – The study adopts the generalized method of moments estimator and collects firm-level cross-sectional data from 77 MIEs. Findings – The evidence shows that political uncertainty, employee tenure security and firm age negatively impact firm performance. Also, external quality assurance mainly improves firm performance. Additionally, foreign-owned firms benefit from corruption more than their domestic counterparts. Moreover, there are ownership and sector effects in the firm performance drivers. Practical implications – The findings suggest the need for MIE firm managers to implement policies and programs to improve permanent employees' efficiency, commitment and honesty. Policy makers and political actors must work toward a stable political environment in MIEs. The policy must also focus on at least minimizing corruption. Originality/value – The study shows the contributions of employee tenure security, political instability and corruption to the performance of MIE firms. It documents sector and ownership effects in the factors influencing firm performance. |
| first_indexed | 2024-03-12T14:39:47Z |
| format | Article |
| id | doaj.art-1e7d85a6d03446a087c08633f0119a1d |
| institution | Directory Open Access Journal |
| issn | 1859-0020 2632-5330 |
| language | English |
| last_indexed | 2024-03-12T14:39:47Z |
| publishDate | 2023-08-01 |
| publisher | Emerald Publishing |
| record_format | Article |
| series | Journal of Economics and Development |
| spelling | doaj.art-1e7d85a6d03446a087c08633f0119a1d2023-08-16T11:45:00ZengEmerald PublishingJournal of Economics and Development1859-00202632-53302023-08-0125322624310.1108/JED-06-2022-0105Political environment, employee tenure security and firm performance in middle-income economiesNicholas Addai Boamah0Francis Ofori-Yeboah1Kingsley Opoku Appiah2Department of Accounting and Finance, Kwame Nkrumah University of Science and Technology, Kumasi, GhanaDepartment of Accounting and Finance, Kwame Nkrumah University of Science and Technology, Kumasi, GhanaDepartment of Accounting and Finance, Kwame Nkrumah University of Science and Technology, Kumasi, GhanaPurpose – The study investigates the effect of political instability and employee tenure security on the performance of firms in middle-income economies (MIEs) after controlling for the influence of corruption, international quality certification, external auditor services and firm age. It examines whether ownership and sector effects matter in the explored relationships. Design/methodology/approach – The study adopts the generalized method of moments estimator and collects firm-level cross-sectional data from 77 MIEs. Findings – The evidence shows that political uncertainty, employee tenure security and firm age negatively impact firm performance. Also, external quality assurance mainly improves firm performance. Additionally, foreign-owned firms benefit from corruption more than their domestic counterparts. Moreover, there are ownership and sector effects in the firm performance drivers. Practical implications – The findings suggest the need for MIE firm managers to implement policies and programs to improve permanent employees' efficiency, commitment and honesty. Policy makers and political actors must work toward a stable political environment in MIEs. The policy must also focus on at least minimizing corruption. Originality/value – The study shows the contributions of employee tenure security, political instability and corruption to the performance of MIE firms. It documents sector and ownership effects in the factors influencing firm performance.https://www.emerald.com/insight/content/doi/10.1108/JED-06-2022-0105/full/pdfPolitical instabilityEmployee–organization relationshipCorruptionResource-based viewMarket-based viewSocial exchange |
| spellingShingle | Nicholas Addai Boamah Francis Ofori-Yeboah Kingsley Opoku Appiah Political environment, employee tenure security and firm performance in middle-income economies Journal of Economics and Development Political instability Employee–organization relationship Corruption Resource-based view Market-based view Social exchange |
| title | Political environment, employee tenure security and firm performance in middle-income economies |
| title_full | Political environment, employee tenure security and firm performance in middle-income economies |
| title_fullStr | Political environment, employee tenure security and firm performance in middle-income economies |
| title_full_unstemmed | Political environment, employee tenure security and firm performance in middle-income economies |
| title_short | Political environment, employee tenure security and firm performance in middle-income economies |
| title_sort | political environment employee tenure security and firm performance in middle income economies |
| topic | Political instability Employee–organization relationship Corruption Resource-based view Market-based view Social exchange |
| url | https://www.emerald.com/insight/content/doi/10.1108/JED-06-2022-0105/full/pdf |
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