A Validation of a Collective Human Capital Strength Measurement

Abstract

Human capital (HC) has become one of the most researched topics in the knowledge economy. Yeh (2006) in a review on the concept of human capital revealed several problems in the research of human capital at organizational level To correct these problems, Yeh (2006) developed a new measurement of organizational HC which included three new sub-constructs (i.e., human capital-organization fit, complementarity of human capital, and specificity of human capital) from the resource-based perspective. This study attempted to extend Yeh's 2006 study in order to cross-validate the newly developed measure of collective human capital Data were collected from a larger sample of knowledge-based companies in Taiwan. All analyses were targeted at the organizational level. A total of 153 highest-level executives of Taiwan's knowledge-intensive companies provided ratings of their collective human capital strength using this instrument. After exploratory factor analysis, measurement items were screened for congruence with the theorized factor structure. The remaining items form a second-order measurement model which included four first-order constructs (human capital-organization fit, complementarity of human capital, cohesion of human capital and specificity of human capital) under collective human capital strength. The model was entered into a confirmatory factor analysis using LISREL. After minor modification, the model achieved acceptable fit on major fit indices reported by LISREL.