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Profit-sharing: A Governance Instrument to Coordinate the Human Capital |
CHEN He, PU Hui-Ying, SUI Guang-Jun |
1. Guangdong University of Foreign Studies, Guangzhou, China; 2. Jinan University, Guangzhou, China |
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Abstract Based one the model of Mumcu, this paper tries to model a negotiation about wage between humancapitalintensive firms and human capital. The importance of human capital upgrades gradually by its specific investment and human capital’s power of the negotiation about wage boosts up gradually too. Under the circumstance, critical human capital not only can get the equilibrium wage of the labor market, but also can share the value which is created by him and the firm. On the contrary, when the dependency of human capital of humancapitalintensive firms reinforces and humancapitalintensive firms become difficult to control human capital, the firm just can coordinate the human capital to cooperate with the firm by profitsharing and realize the winwin condition.
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Received: 27 January 2010
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