Convergence or Divergence between European HRM and American HRM

Gurhan Uysal
(School of Business, Ondokuz Mayıs University, 55139 Samsun, Turkey)

Abstract: American HRM has shareholder perspective, and European HRM has stakeholder perspective. This creates divergence between HRM of both markets. This divergence makes social context important in European HRM. European HRM aims to protect interests of society; therefore, there is involvement of social partners in European HRM. American HRM aims to protect interests of shareholders in firms. Thus, American HRM is performance-oriented. Divergence may appear due to economic system difference between two markets. USA has liberal market economy view, and EU has coordinated market economy view, and EU is regulated economy. Thus, firms are autonomous in American HRM due to liberal market view. EU firms are restricted in HRM due to social awareness of regulated economy. However, firms are becoming deregulated in EU economy similar to USA economy. There is debate in academic literature, if there is European HRM or HRM in Europe. European firms apply European HRM recently. European HRM covers American HRM and social partners. Social variables make European HRM divergent from American HRM. European firms are adopting firm performance orientation in HRM. This makes European HRM convergent with American HRM.

Key words: European HRM; American HRM; social context; convergence; divergence issue

JEL codes: M12, M16, M21