Human Capital Is Dead; Long Live Human Capital Resources!

Abstract

This paper introduces a radically different conceptualization of human capital resources that runs counter to the individual-level approaches that have dominated human capital theory for the last 50 years. We leverage insights from economics, strategy, human resources, and psychology to develop an integrated and holistic framework that defines the structure, function, levels, and combinations of human capital resources. This multidisciplinary framework redefines human capital resources as individual or unit-level capacities based on individual knowledge, skills, abilities, and other characteristics (KSAOs) that are accessible for unit-relevant purposes. The framework and definition offer three broad contributions. First, multidisciplinary communication is facilitated by providing precise definitions and distinctions between individual differences, KSAOs, human capital, human capital resources, and strategic human capital resources. Second, given that human capital resources originate in individuals’ KSAOs, multiple distinct types of human capital resources exist at individual and collective levels, and these types are much more diverse than the historical generic-specific distinction. Third, the multiple types of human capital resources may be combined within and across levels, via processes of emergence and complementarity. Consequently, the locus of competitive advantage has less to do with whether human capital resources are generic or specific but instead occurs because nearly all human capital resource combinations are complex, are firm-specific, and lack strategic (or efficient) factor markets. Overall, the proposed multidisciplinary framework opens new avenues for future research that challenge the prevailing literature’s treatment of human capital resources.