IZA DP No. 15316: The Interplay between Organizational Structure, Culture and Employees’ Socio-Emotional Skills within Their Social Capital
Organization theorists identify organizational social capital as one of the primary building blocks of a potentially powerful resource for improving organizational performance. However, little is known about the impact of the socio-emotional skills of the employees within their social capital and its relationship with other important organizational constructs such as organizational culture and structure. This study is the first to develop an integrated model which in addition to existing organizational constructs (i.e., organizational culture and structure) explicitly accounts for the influence of the social tolerance of employees (i.e., an example of socio-emotional skills within a workplace) on their happiness. In our model, the concept of employee’s socio-emotional skill cannot be measured directly. Therefore, we developed two latent hypothetical sub-constructs and we refer to them throughout this paper as social capital (i.e., which at the micro-level points to the interactions and socializations of the employees) and social tolerance (i.e., social tolerance towards others’ social status), each of which is measured by its observable indicators. We apply our model to empirical data that we collected from East Asian Social Survey (EASS) only for the year 2012. The data was available for four East Asian countries of South Korea, Japan, Taiwan, and China. Our analysis shows that even though the skill of social tolerance is not observed to increase happiness by itself, it has been observed to show a significant impact on the level of trust among employees. Trust among colleagues also in its own turn significantly impacts the employees’ level of happiness. This finding can be applied in empowering the cognitive dimension of social capital within an organization.