The interaction between financial and human resource slack and its effect on firm performance

Extant research has largely focused on the independent performance consequences of different types of resource slack. In this paper, we study how the interaction between financial and human resource slack affects firm performance and this for firms in different stages of development. For this purpose, we use a longitudinal database of 733 French firms active in the Information and Communication Technology industry. Our results show that having both high levels of financial and human resource slack is detrimental for firm performance. This is especially the case for firms that have moved beyond the emergent stage into later stages of development.