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The Growth of Extended 'Entry Tournaments' and the Decline of Institutionalised Occupational Labour Markets in Britain

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  • David Marsden

Abstract

In recent years, British labour markets have been characterised by a decline of institutional regulation of entry routes into many occupations and internal labour markets. This paper examines this change by comparing occupational labour markets for selected occupations in which institutional regulation has remained largely intact with those in which entry has become more fluid. It argues that in the latter case, structured entry paths, which were characterised by competition at the ports of entry, have given way to extended entry tournaments in which competition is spread over a much longer time period. Using data from the New Earnings Survey panel for 1975-2001, it relates the comparatively greater growth in earnings inequality in these occupations to the emergence of extended entry tournaments. As pay at the top has risen, greater competition for entry at the bottom has held down pay and depressed conditions. It argues that many of the aspirant members of these occupations compete for entry for too long, and then become trapped as it is too late to change occupation.

Suggested Citation

  • David Marsden, 2010. "The Growth of Extended 'Entry Tournaments' and the Decline of Institutionalised Occupational Labour Markets in Britain," CEP Discussion Papers dp0989, Centre for Economic Performance, LSE.
  • Handle: RePEc:cep:cepdps:dp0989
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    References listed on IDEAS

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    1. Lazear, Edward P & Rosen, Sherwin, 1981. "Rank-Order Tournaments as Optimum Labor Contracts," Journal of Political Economy, University of Chicago Press, vol. 89(5), pages 841-864, October.
    2. Marsden, David, 2007. "Labour market segmentation in Britain: the decline of occupational labour markets and the spread of ‘entry tournaments'," LSE Research Online Documents on Economics 3305, London School of Economics and Political Science, LSE Library.
    3. Alice Lam, 2003. "Organizational Learning in Multinationals: R&D Networks of Japanese and US MNEs in the UK," Journal of Management Studies, Wiley Blackwell, vol. 40(3), pages 673-703, May.
    4. David H. Autor & Frank Levy & Richard J. Murnane, 2003. "The skill content of recent technological change: an empirical exploration," Proceedings, Federal Reserve Bank of San Francisco, issue Nov.
    5. Peter AUER & Sandrine CAZES, 2000. "The resilience of the long-term employment relationship: Evidence from the industrialized countries," International Labour Review, International Labour Organization, vol. 139(4), pages 379-408, December.
    6. Maarten Goos & Alan Manning, 2007. "Lousy and Lovely Jobs: The Rising Polarization of Work in Britain," The Review of Economics and Statistics, MIT Press, vol. 89(1), pages 118-133, February.
    7. Bognanno, Michael L, 2001. "Corporate Tournaments," Journal of Labor Economics, University of Chicago Press, vol. 19(2), pages 290-315, April.
    8. Eyraud, Francois & Marsden, David & Silvestre, Jean-Jacques, 1990. "Occupational and internal labour markets in Britain and France," LSE Research Online Documents on Economics 21305, London School of Economics and Political Science, LSE Library.
    9. Wiemer Salverda & Ken Mayhew, 2009. "Capitalist economies and wage inequality," Oxford Review of Economic Policy, Oxford University Press, vol. 25(1), pages 126-154, Spring.
    10. Stevens, Margaret, 1994. "An Investment Model for the Supply of Training by Employers," Economic Journal, Royal Economic Society, vol. 104(424), pages 556-570, May.
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    12. Gary S. Becker, 1975. "Human Capital: A Theoretical and Empirical Analysis, with Special Reference to Education, Second Edition," NBER Books, National Bureau of Economic Research, Inc, number beck75-1, July.
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    Cited by:

    1. William Brown & David Marsden, 2010. "Individualisation and Growing Diversity of Employment Relationships," CEP Discussion Papers dp1037, Centre for Economic Performance, LSE.

    More about this item

    Keywords

    Wage Level and Structure; Wage Differentials by Skill; Training; Professional Labor Markets and Occupations;

    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J44 - Labor and Demographic Economics - - Particular Labor Markets - - - Professional Labor Markets and Occupations

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