With the advantageous effects of adopting an entrepreneurial orientation (EO) on corporate expansion and financial gains being firmly established, scholars have begun to explore the broader implications of adopting an entrepreneurial strategy. Unfortunately, these implications often still revolve around financial results, leaving the effect of EO on more intangible firm resources unclear. We zero in on human capital and study how EO affects employee well-being. To theorize the relationship between EO and employee well-being, we build on resource exhaustion theory. Resource exhaustion theory allows us to specify the conditions under which EO is beneficial or becomes too explorative and unsustainable for employee well-being. We test our hypotheses using a panel dataset tracking S&P500 firms from 2016 to 2020, which we created by merging data from Indeed.com, letters to shareholders, and Compustat. The data show that EO generally contributes to employee well-being while also allowing for a more nuanced interpretation of this effect. Specifically, we find evidence that the resource endowment of the firms and the dynamics of the industries in which they operate can amplify the effect of EO on employee well-being and, conversely, that EO may not be productive for employee well-being in very stable industry conditions.
