It’s Not Who You Know—It’s Who Knows You: Employee Social Capital and Firm Performance

Published Online:https://doi.org/10.1287/mnsc.2023.01179

References

  • Acemoglu D, Johnson S, Kermani A, Kwak J, Mitton T (2016) The value of connections in turbulent times: Evidence from the United States. J. Financial Econom. 121(2):368–391.CrossrefGoogle Scholar
  • Ahern KR (2009) Sample selection and event study estimation. J. Empirical Finance 16(3):466–482.CrossrefGoogle Scholar
  • Ahern KR, Sosyura D (2014) Who writes the news? Corporate press releases during merger negotiations. J. Finance 69(1):241–291.CrossrefGoogle Scholar
  • Anderson RC, Reeb DM (2003) Founding-family ownership and firm performance: Evidence from the S&P 500. J. Finance 58(3):1301–1328.CrossrefGoogle Scholar
  • Bourdieu P (1986) The forms of capital. Richardson JG, ed. Handbook of Theory and Research for the Sociology of Education (Greenwood Press, New York), 241–258.Google Scholar
  • Bowles S, Gintis H (2002) Social capital and community governance. Econom. J. 112(483):F419–F436.Google Scholar
  • Cai Y, Sevilir M (2012) Board connections and M&A transactions. J. Financial Econom. 103(2):327–349.CrossrefGoogle Scholar
  • Cai J, Szeidl A (2017) Interfirm relationships and business performance. Quart. J. Econom. 133(3):1229–1282.CrossrefGoogle Scholar
  • Cai H, Fang H, Xu LC (2011) Eat, drink, firms, government: An investigation of corruption from the entertainment and travel costs of Chinese firms. J. Law Econom. 54(1):55–78.CrossrefGoogle Scholar
  • Choi SG, Storr VH (2019) A culture of rent seeking. Public Choice 181(1/2):101–126.CrossrefGoogle Scholar
  • Cohen WM, Levinthal DA (1990) Absorptive capacity: A new perspective on learning and innovation. Admin. Sci. Quart. 35(1):128–152.CrossrefGoogle Scholar
  • Cohen L, Frazzini A, Malloy C (2010) Sell-side school ties. J. Finance 65(4):1409–1437.CrossrefGoogle Scholar
  • Coleman JS (1988) Social capital in the creation of human capital. Amer. J. Sociol. 94(1):S95–S120.CrossrefGoogle Scholar
  • Dass N, Kini O, Nanda V, Onal B, Wang J (2014) Board expertise: Do directors from related industries help bridge the information gap? Rev. Financial Stud. 27(5):1533–1592.CrossrefGoogle Scholar
  • DeWenter KL, Malatesta PH (2001) State-owned and privately owned firms: An empirical analysis of profitability, leverage, and labor intensity. Amer. Econom. Rev. 91(1):320–334.CrossrefGoogle Scholar
  • Dizik A (2016) Why business cards still matter. BBC (September 18), https://www.bbc.com/worklife/article/20160914-how-a-small-yet-mighty-bit-of-paper-can-still-get-you-a-job.Google Scholar
  • Dougal C, Engelberg J, García D, Parsons CA (2012) Journalists and the stock market. Rev. Financial Stud. 25(3):639–679.CrossrefGoogle Scholar
  • Eisfeldt AL, Papanikolaou D (2013) Organization capital and the cross-section of expected returns. J. Finance 68(4):1365–1406.CrossrefGoogle Scholar
  • Engelberg J, Gao P, Parsons CA (2012) Friends with money. J. Financial Econom. 103(1):169–188.CrossrefGoogle Scholar
  • Fracassi C, Tate G (2012) External networking and internal firm governance. J. Finance 67(1):153–194.CrossrefGoogle Scholar
  • Frésard L, Hoberg G, Phillips GM (2020) Innovation activities and integration through vertical acquisitions. Rev. Financial Stud. 33(7):2937–2976.CrossrefGoogle Scholar
  • Glaeser EL, Laibson D, Sacerdote B (2002) An economic approach to social capital. Econom. J. 112(483):437–458.Google Scholar
  • Gompers PA, Mukharlyamov V, Xuan Y (2016) The cost of friendship. J. Financial Econom. 119(3):626–644.CrossrefGoogle Scholar
  • Gortmaker J, Jeffers J, Lee MJ (2022) Labor reactions to credit deterioration: Evidence from LinkedIn activity. Working paper, HEC Paris, Jouy-en-Josas.Google Scholar
  • Gorton GB, Grennan J, Zentefis AK (2022) Corporate culture. Annual Rev. Financial Econom. 14(1):535–561.CrossrefGoogle Scholar
  • Graham JR, Grennan J, Harvey CR, Rajgopal S (2022a) Corporate culture: The interview evidence. J. Appl. Corporate Finance 34(4):22–41.Google Scholar
  • Graham JR, Grennan J, Harvey CR, Rajgopal S (2022b) Corporate culture: Evidence from the field. J. Financial Econom. 146(2):552–593.CrossrefGoogle Scholar
  • Granovetter MS (1973) The strength of weak ties. Amer. J. Sociol. 78(6):1360–1380.CrossrefGoogle Scholar
  • Granovetter MS (1995) Getting a Job: A Study of Contacts and Careers (University of Chicago Press, Chicago).CrossrefGoogle Scholar
  • Grennan J (2022) Communicating culture consistently: Evidence from banks. Working paper, Emory University, Atlanta, GA.Google Scholar
  • Grennan J, Li K (2022) Corporate culture: A review and directions for future research. Working paper, Duke University, Durham, NC.Google Scholar
  • Guiso L, Sapienza P, Zingales L (2004) The role of social capital in financial development. Amer. Econom. Rev. 94(3):526–556.CrossrefGoogle Scholar
  • Guiso L, Sapienza P, Zingales L (2008) Trusting the stock market. J. Finance 63(6):2557–2600.CrossrefGoogle Scholar
  • Guiso L, Sapienza P, Zingales L (2015) The value of corporate culture. J. Financial Econom. 117(1):60–76.CrossrefGoogle Scholar
  • Gurun UG, Butler AW (2012) Don’t believe the hype: Local media slant, local advertising, and firm value. J. Finance 67(2):561–597.CrossrefGoogle Scholar
  • Hacamo I, Kleiner K (2022) Competing for talent: Firms, managers, and social networks. Rev. Financial Stud. 35(1):207–253.CrossrefGoogle Scholar
  • Hasan I, Keung Hoi C, Wu Q, Zhang H (2017) Social capital and debt contracting: Evidence from bank loans and public bonds. J. Financial Quant. Anal. 52(3):1017–1047.CrossrefGoogle Scholar
  • Haselmann R, Schoenherr D, Vig V (2018) Rent seeking in elite networks. J. Political Econom. 126(4):1638–1690.CrossrefGoogle Scholar
  • Hirshleifer DA, Peng L, Wang Q (2025) News diffusion in social networks and stock market reactions. Rev. Financial Stud. 38(3):883–937.Google Scholar
  • Hochberg YV, Ljungqvist A, Lu Y (2007) Whom you know matters: Venture capital networks and investment performance. J. Finance 62(1):251–301.CrossrefGoogle Scholar
  • Hoi CK, Wu Q, Zhang H (2019) Does social capital mitigate agency problems? Evidence from Chief Executive Officer (CEO) compensation. J. Financial Econom. 133(2):498–519.CrossrefGoogle Scholar
  • Houston JF, Lee J, Suntheim F (2018) Social networks in the global banking sector. J. Accounting Econom. 65(2–3):237–269.CrossrefGoogle Scholar
  • Hwang B-H, Kim S (2009) It pays to have friends. J. Financial Econom. 93(1):138–158.CrossrefGoogle Scholar
  • Ishii J, Xuan Y (2014) Acquirer-target social ties and merger outcomes. J. Financial Econom. 112(3):344–363.CrossrefGoogle Scholar
  • Jackson MO (2008) Social and Economic Networks (Princeton University Press, Princeton, NJ).CrossrefGoogle Scholar
  • Jeffers J, Lee MJ (2019) Corporate culture as an implicit contract. Working paper, HEC Paris, Jouy-en-Josas.Google Scholar
  • Kang S, Kim D, Kim G (2023) Corporate entertainment expenses and corruption in public procurement. J. Asian Econom. 84(1):101554. Google Scholar
  • Karolyi SA (2018) Personal lending relationships. J. Finance 73(1):5–49.CrossrefGoogle Scholar
  • Khanna V, Kim EH, Lu Y (2015) CEO connectedness and corporate fraud. J. Finance 70(3):1203–1252.CrossrefGoogle Scholar
  • Knack S, Keefer P (1997) Does social capital have an economic payoff? A cross-country investigation. Quart. J. Econom. 112(4):1251–1288.CrossrefGoogle Scholar
  • Kuchler T, Li Y, Peng L, Stroebel J, Zhou D (2022) Social proximity to capital: Implications for investors and firms. Rev. Financial Stud. 35(6):2743–2789.CrossrefGoogle Scholar
  • La Porta R, Lakonishok J, Shleifer A, Vishny RW (1997a) Good news for value stocks: Further evidence on market efficiency. J. Finance 52(2):859–874.CrossrefGoogle Scholar
  • La Porta R, Lopez-de-Silanes F, Shleifer A, Vishny RW (1997b) Trust in large organizations. Amer. Econom. Rev. 87(2):333–338.Google Scholar
  • Larcker DF, So EC, Wang CCY (2013) Boardroom centrality and firm performance. J. Accounting Econom. 55(2–3):225–250.CrossrefGoogle Scholar
  • Lev B, Radhakrishnan S (2005) The valuation of organization capital. Corrado C, Haltiwanger J, Sichel D, eds. Measuring Capital in the New Economy (University of Chicago Press, Chicago), 73–110.CrossrefGoogle Scholar
  • Lin N (2002) Social Capital: A Theory of Social Structure and Action (Cambridge University Press, Cambridge, UK).Google Scholar
  • Lin N, Ensel W, Vaughn J (1981) Social resources and strength of ties: Structural factors in occupational status attainment. Amer. Sociol. Rev. 46(4):393–405.CrossrefGoogle Scholar
  • Lins KV, Servaes H, Tamayo A (2017) Social capital, trust, and firm performance: The value of corporate social responsibility during the financial crisis. J. Finance 72(4):1785–1824.CrossrefGoogle Scholar
  • Nahapiet J, Ghoshal S (1998) Social capital, intellectual capital, and the organizational advantage. Acad. Management Rev. 23(2):242–266.CrossrefGoogle Scholar
  • Newman MEJ (2010) Networks: An Introduction (Oxford University Press, Oxford, UK).CrossrefGoogle Scholar
  • OECD (2015) Government at a Glance 2015 (OECD Publishing, Paris), 136–137.Google Scholar
  • Peters RH, Taylor LA (2017) Intangible capital and the investment-q relation. J. Financial Econom. 123(2):251–272.CrossrefGoogle Scholar
  • Popadak J (2016) Balancing governance and culture to create sustainable firm value. Brookings Institution Governance Studies no. 27, Brookings Institution, Washington, DC.Google Scholar
  • Putnam RD (1993) Making Democracy Work: Civic Traditions in Modern Italy (Princeton University Press, Princeton, NJ).Google Scholar
  • Putnam RD (2000) Bowling Alone: The Collapse and Revival of American Community (Simon & Schuster, New York).CrossrefGoogle Scholar
  • Radner R (1992) Hierarchy: The economics of managing. J. Econom. Literature 30(3):1382–1415.Google Scholar
  • Rossi AG, Blake D, Timmermann A, Tonks I, Wermers R (2018) Network centrality and delegated investment performance. J. Financial Econom. 128(1):183–206.CrossrefGoogle Scholar
  • Schoenherr D (2019) Political connections and allocative distortions. J. Finance 74(2):543–586.CrossrefGoogle Scholar
  • Servaes H, Tamayo A (2017) The role of social capital in corporations: A review. Oxford Rev. Econom. Policy 33(2):201–220.CrossrefGoogle Scholar
  • Shue K (2013) Executive networks and firm policies: Evidence from the random assignment of MBA peers. Rev. Financial Stud. 26(6):1401–1442.CrossrefGoogle Scholar
  • Syverson C (2011) What determines productivity? J. Econom. Literature 49(2):326–365.CrossrefGoogle Scholar
  • Tetlock PC, Saar‐Tsechansky M, Macskassy S (2008) More than words: Quantifying language to measure firms’ fundamentals. J. Finance 63(3):1437–1467.CrossrefGoogle Scholar
INFORMS site uses cookies to store information on your computer. Some are essential to make our site work; Others help us improve the user experience. By using this site, you consent to the placement of these cookies. Please read our Privacy Statement to learn more.