Does employee-based human capital breathe new life into business? Empirical evidence from Pakistani marble manufacturing sector

Abstract

Human capital is a widely-discussed phenomenon in the area of human resource management. However, employee-based human capital, which is strongly associated with firm performance, is still not empirically measured in most studies. The present study investigates the role of employee-based human capital on firm performance within the framework of the resource-based view (RBV). Employing a sample of 209 marble manufacturing units, the study confirm the validity of measurement models via CB-SEM. The findings show a strong coefficient of determination for the overall structural model. The regression weight for employee-based human capital in the prediction of firm performance is significant at the 0.001 level (one-tailed). Findings of the study have a number of key implications for academicians and HR practitioners. Limitations and future research directions research are also discussed.