The choice between internalization and externalization of employment and its impact on firm performance: evidence from five south-eastern European countries

Abstract

The present study explores the notions of internalization and externalization of employment in five south-eastern European countries, namely Bulgaria, Cyprus, Greece, Italy and Slovenia. More specifically, it examines whether the choice between internalization and externalization of employment influences organizational performance and whether this relationship changes between the different countries studied. The study is based on the south-eastern European sub-sample of the Cranet project. The main findings indicate significant differences and similarities between the five countries and show that HRM practices supporting internalization have more impact on top performance, than those of externalization.

Keywords:

• Cranet
• firm performance
• internalization and externalization of employment
• south-eastern Europe