IDEAS home Printed from https://ideas.repec.org/a/ucp/jpemac/doi10.1086-725789.html
   My bibliography  Save this article

Customer Churn and Intangible Capital

Author

Listed:
  • Scott R. Baker
  • Brian Baugh
  • Marco Sammon

Abstract

We develop and make available firm-level metrics regarding a key component of intangible capital—firms’ customer bases—using household transaction data. Linking household spending to top customer-facing firms, we show that churn in customer bases is associated with lower markups and market-to-book ratios and higher leverage. Churn is closely linked to firm-level volatility and risk. This new measure provides a clearer picture of firms’ customer and brand capital than existing metrics and is also observable for private firms. We demonstrate that low levels of customer churn push firms away from neoclassical investment responsiveness and that low-churn firms are better able to insulate organization capital from the risk of key-talent flight.

Suggested Citation

  • Scott R. Baker & Brian Baugh & Marco Sammon, 2023. "Customer Churn and Intangible Capital," Journal of Political Economy Macroeconomics, University of Chicago Press, vol. 1(3), pages 447-505.
    • Handle: RePEc:ucp:jpemac:doi:10.1086/725789
    DOI: 10.1086/725789
    as

    Download full text from publisher

    File URL: https://dx.doi.org/10.1086/725789
    Download Restriction: Access to the online full text or PDF requires a subscription.
    File URL: https://dx.doi.org/10.1086/725789
    Download Restriction: Access to the online full text or PDF requires a subscription.
    File URL: https://libkey.io/10.1086/725789?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ucp:jpemac:doi:10.1086/725789. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Journals Division (email available below). General contact details of provider: https://www.journals.uchicago.edu/JPEMA .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.