IDEAS home Printed from https://ideas.repec.org/p/ese/iserwp/2009-11.html
   My bibliography  Save this paper

The determinants of promotions and firm separations

Author

Listed:
  • Ferreira, Priscila

Abstract

This paper identities and compares the determinants of within- and between-firm job mobility in Portugal. Estimates are based on models that distinguish promotions by whether or not they involve a change in the tasks performed, and separations by the time workers take to enter a new firm. Both worker and firm observed characteristics emerge as important factors in the analysis. Firm unobserved heterogeneity is relevant, evidence suggests that firms vary more in their unobserved propensity to promote than in the case of separations. Overall, this study highlights two main issues; the role of firms in the process of job mobility, and the importance of distinguishing not only between types of separations from firms, but also between types of promotions within firms.

Suggested Citation

  • Ferreira, Priscila, 2009. "The determinants of promotions and firm separations," ISER Working Paper Series 2009-11, Institute for Social and Economic Research.
    • Handle: RePEc:ese:iserwp:2009-11
    as

    Download full text from publisher

    File URL: https://www.iser.essex.ac.uk/wp-content/uploads/files/working-papers/iser/2009-11.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Mata, Jose & Portugal, Pedro, 1994. "Life Duration of New Firms," Journal of Industrial Economics, Wiley Blackwell, vol. 42(3), pages 227-245, September.
    2. 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.
    3. Alison L. Booth & Marco Francesconi & Carlos Garcia-Serrano, 1999. "Job Tenure and Job Mobility in Britain," ILR Review, Cornell University, ILR School, vol. 53(1), pages 43-70, October.
    4. Jovanovic, Boyan, 1984. "Matching, Turnover, and Unemployment," Journal of Political Economy, University of Chicago Press, vol. 92(1), pages 108-122, February.
    5. Guillaume Horny & Rute Mendes & Gerard J. van den Berg, 2012. "Job Durations With Worker- and Firm-Specific Effects: MCMC Estimation With Longitudinal Employer--Employee Data," Journal of Business & Economic Statistics, Taylor & Francis Journals, vol. 30(3), pages 468-480, March.
    6. Sicherman, Nachum & Galor, Oded, 1990. "A Theory of Career Mobility," Journal of Political Economy, University of Chicago Press, vol. 98(1), pages 169-192, February.
    7. George Baker & Michael Gibbs & Bengt Holmstrom, 1994. "The Wage Policy of a Firm," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 109(4), pages 921-955.
    8. Katharine G. Abraham & James L. Medoff, 1985. "Length of Service and Promotions in Union and Nonunion Work Groups," ILR Review, Cornell University, ILR School, vol. 38(3), pages 408-420, April.
    9. James A. Fairburn & James M. Malcomson, 2001. "Performance, Promotion, and the Peter Principle," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 68(1), pages 45-66.
    10. Roberto G. Gutierrez, 2002. "Parametric frailty and shared frailty survival models," Stata Journal, StataCorp LP, vol. 2(1), pages 22-44, February.
    11. Jones, David R & Makepeace, Gerald H, 1996. "Equal Worth, Equal Opportunities: Pay and Promotion in an Internal Labour Market," Economic Journal, Royal Economic Society, vol. 106(435), pages 401-409, March.
    12. Farber, Henry S, 1994. "The Analysis of Interfirm Worker Mobility," Journal of Labor Economics, University of Chicago Press, vol. 12(4), pages 554-593, October.
    13. Viscusi, W Kip, 1980. "Sex Differences in Worker Quitting," The Review of Economics and Statistics, MIT Press, vol. 62(3), pages 388-398, August.
    14. Chan, William, 1996. "External Recruitment versus Internal Promotion," Journal of Labor Economics, University of Chicago Press, vol. 14(4), pages 555-570, October.
    15. Rosen, Sherwin, 1986. "Prizes and Incentives in Elimination Tournaments," American Economic Review, American Economic Association, vol. 76(4), pages 701-715, September.
    16. Van den Berg, Gerard J., 2001. "Duration models: specification, identification and multiple durations," Handbook of Econometrics, in: J.J. Heckman & E.E. Leamer (ed.), Handbook of Econometrics, edition 1, volume 5, chapter 55, pages 3381-3460, Elsevier.
    17. Marco Francesconi, 2001. "Determinants and Consequences of Promotions in Britain," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 63(3), pages 279-310, July.
    18. Bernhardt, Dan & Scoones, David, 1993. "Promotion, Turnover, and Preemptive Wage Offers," American Economic Review, American Economic Association, vol. 83(4), pages 771-791, September.
    19. Robert H. Topel & Michael P. Ward, 1992. "Job Mobility and the Careers of Young Men," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 107(2), pages 439-479.
    20. Alan K. Severn, 1968. "Upward Labor Mobility: Opportunity or Incentive?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 82(1), pages 143-151.
    21. Francine D. Blau & Lawrence M. Kahn, 1981. "Race and Sex Differences in Quits by Young Workers," ILR Review, Cornell University, ILR School, vol. 34(4), pages 563-577, July.
    22. Heckman, James J & Borjas, George J, 1980. "Does Unemployment Cause Future Unemployment? Definitions, Questions and Answers from a Continuous Time Model of Heterogeneity and State Dependence," Economica, London School of Economics and Political Science, vol. 47(187), pages 247-283, August.
    23. Edward P. Lazear, 2004. "The Peter Principle: A Theory of Decline," Journal of Political Economy, University of Chicago Press, vol. 112(S1), pages 141-163, February.
    24. Scoones, David & Bernhardt, Dan, 1998. "Promotion, Turnover, and Discretionary Human Capital Acquisition," Journal of Labor Economics, University of Chicago Press, vol. 16(1), pages 122-141, January.
    25. Rosen, Sherwin, 2007. "Studies in Labor Markets," National Bureau of Economic Research Books, University of Chicago Press, number 9780226726304, December.
    26. Frederiksen, Anders, 2008. "Gender differences in job separation rates and employment stability: New evidence from employer-employee data," Labour Economics, Elsevier, vol. 15(5), pages 915-937, October.
    27. Bishop, John H, 1990. "Job Performance, Turnover, and Wage Growth," Journal of Labor Economics, University of Chicago Press, vol. 8(3), pages 363-386, July.
    28. Jacob Mincer & Boyan Jovanovic, 1981. "Labor Mobility and Wages," NBER Chapters, in: Studies in Labor Markets, pages 21-64, National Bureau of Economic Research, Inc.
    29. Lazear, Edward P & Rosen, Sherwin, 1990. "Male-Female Wage Differentials in Job Ladders," Journal of Labor Economics, University of Chicago Press, vol. 8(1), pages 106-123, January.
    30. Bell, Linda A. & Freeman, Richard B., 2001. "The incentive for working hard: explaining hours worked differences in the US and Germany," Labour Economics, Elsevier, vol. 8(2), pages 181-202, May.
    31. Jovanovic, Boyan, 1979. "Job Matching and the Theory of Turnover," Journal of Political Economy, University of Chicago Press, vol. 87(5), pages 972-990, October.
    32. Lancaster,Tony, 1992. "The Econometric Analysis of Transition Data," Cambridge Books, Cambridge University Press, number 9780521437899.
    33. Patricia M. Anderson & Bruce D. Meyer, 1994. "The Extent and Consequences of Job Turnover," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 25(1994 Micr), pages 177-248.
    34. Kristen Keith & Abagail McWilliams, 1999. "The Returns to Mobility and Job Search by Gender," ILR Review, Cornell University, ILR School, vol. 52(3), pages 460-477, April.
    35. Royalty, Anne Beeson, 1998. "Job-to-Job and Job-to-Nonemployment Turnover by Gender and Education Level," Journal of Labor Economics, University of Chicago Press, vol. 16(2), pages 392-443, April.
    36. Mario Cleves & William W. Gould & Roberto G. Gutierrez & Yulia Marchenko, 2010. "An Introduction to Survival Analysis Using Stata," Stata Press books, StataCorp LP, edition 3, number saus3, March.
    37. George Baker & Michael Gibbs & Bengt Holmstrom, 1994. "The Internal Economics of the Firm: Evidence from Personnel Data," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 109(4), pages 881-919.
    38. McCue, Kristin, 1996. "Promotions and Wage Growth," Journal of Labor Economics, University of Chicago Press, vol. 14(2), pages 175-209, April.
    39. Michael R. Pergamit & Jonathan R. Veum, 1999. "What is a Promotion?," ILR Review, Cornell University, ILR School, vol. 52(4), pages 581-601, July.
    40. Lima, Francisco & Pereira, Pedro T., 2001. "Careers and Wage Growth within Large Firms," IZA Discussion Papers 336, Institute of Labor Economics (IZA).
    41. Light, Audrey & Ureta, Manuelita, 1992. "Panel Estimates of Male and Female Job Turnover Behavior: Can Female Nonquitters Be Identified?," Journal of Labor Economics, University of Chicago Press, vol. 10(2), pages 156-181, April.
    42. William R. Johnson, 1978. "A Theory of Job Shopping," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 92(2), pages 261-277.
    43. Jovanovic, Boyan, 1979. "Firm-specific Capital and Turnover," Journal of Political Economy, University of Chicago Press, vol. 87(6), pages 1246-1260, December.
    44. Dale T. Mortensen, 1978. "Specific Capital and Labor Turnover," Bell Journal of Economics, The RAND Corporation, vol. 9(2), pages 572-586, Autumn.
    45. Booth, Alison L. & Francesconi, Marco & Frank, Jeff, 2003. "A sticky floors model of promotion, pay, and gender," European Economic Review, Elsevier, vol. 47(2), pages 295-322, April.
    46. Francisco Lima, 2003. "The Careers of Top Managers and Firm Openness: Internal Versus External Labour Markets," Working Papers w200315, Banco de Portugal, Economics and Research Department.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Ferreira, Priscila, 2009. "The sources of interindustry wage differentials," ISER Working Paper Series 2009-13, Institute for Social and Economic Research.
    2. C. Sofia Machado & Miguel Portela, 2011. "Age and opportunities for promotion," NIPE Working Papers 03/2011, NIPE - Universidade do Minho.
    3. Priscila Ferreira & Mark Taylor, 2011. "Firms and workers: who fails in times of crisis?," NIMA Working Papers 44, Núcleo de Investigação em Microeconomia Aplicada (NIMA), Universidade do Minho.
    4. Ferreira, Priscila, 2009. "Returns to job mobility: the role of observed and unobserved factors," ISER Working Paper Series 2009-12, Institute for Social and Economic Research.
    5. Katrin Rickmeier, 2023. "Navigating Regional Barriers to Job Mobility: The Role of Opportunity Structures in Individual Job-to-Job Transitions," Social Sciences, MDPI, vol. 12(5), pages 1-25, May.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. C. Sofia Machado & Miguel Portela, 2011. "Age and opportunities for promotion," NIPE Working Papers 03/2011, NIPE - Universidade do Minho.
    2. repec:eee:labchp:v:3:y:1999:i:pb:p:2373-2437 is not listed on IDEAS
    3. Cassidy, Hugh & DeVaro, Jed & Kauhanen, Antti, 2016. "Promotion signaling, gender, and turnover: New theory and evidence," Journal of Economic Behavior & Organization, Elsevier, vol. 126(PA), pages 140-166.
    4. Bas Klaauw & António Dias da Silva, 2011. "Wage dynamics and promotions inside and between firms," Journal of Population Economics, Springer;European Society for Population Economics, vol. 24(4), pages 1513-1548, October.
    5. Melero Martín, Eduardo, 2004. "Evidence on Training and Career Paths: Human Capital, Information and Incentives," IZA Discussion Papers 1377, Institute of Labor Economics (IZA).
    6. Frederiksen, Anders & Halliday, Timothy J. & Koch, Alexander K., 2010. "What Do We Work For? An Anatomy of Pre- and Post-Tax Earnings Growth," IZA Discussion Papers 5298, Institute of Labor Economics (IZA).
    7. Merja Kauhanen & Sami Napari, 2010. "Wage Growth and Mobility Between and Within Firms by Gender and Education," Working Papers 260, Työn ja talouden tutkimus LABORE, The Labour Institute for Economic Research LABORE.
    8. Ghosh, Suman, 2007. "Job mobility and careers in firms," Labour Economics, Elsevier, vol. 14(3), pages 603-621, June.
    9. Anders Frederiksen & Timothy Halliday & Alexander K. Koch, 2016. "Within- and Cross-Firm Mobility and Earnings Growth," ILR Review, Cornell University, ILR School, vol. 69(2), pages 320-353, March.
    10. FOUARGE Didier & MUFFELS Ruud & PAVLOPOULOS Dimitris & VERMUNT Jeroen K., 2007. "Who benefits from a job change: The dwarfs or the giants?," IRISS Working Paper Series 2007-16, IRISS at CEPS/INSTEAD.
    11. Mario Bossler & Philipp Grunau, 2020. "Asymmetric information in external versus internal promotions," Empirical Economics, Springer, vol. 59(6), pages 2977-2998, December.
    12. Xin Jin, 2014. "The Signaling Role of Not Being Promoted: Theory and Evidence," Working Papers 0314, University of South Florida, Department of Economics.
    13. Robert Gibbons & Michael Waldman, 2006. "Enriching a Theory of Wage and Promotion Dynamics inside Firms," Journal of Labor Economics, University of Chicago Press, vol. 24(1), pages 59-108, January.
    14. repec:eee:labchp:v:2:y:1986:i:c:p:849-919 is not listed on IDEAS
    15. José Ángel Zúñiga Vicente & José David Vicente Lorente, 2003. "Assessing the Structural Change of Strategic Mobility Determinants Under Hypercompetitive Environments," Working Papers 0302, Departament Empresa, Universitat Autònoma de Barcelona, revised Feb 2003.
    16. Acosta, Pablo, 2010. "Promotion dynamics the Peter Principle: Incumbents vs. external hires," Labour Economics, Elsevier, vol. 17(6), pages 975-986, December.
    17. Xiaolin Xing & Zhenlin Yang, 2005. "Determinants of Job Turnover Intentions : Evidence from Singapore," Labor Economics Working Papers 22588, East Asian Bureau of Economic Research.
    18. repec:eee:labchp:v:3:y:1999:i:pb:p:2439-2483 is not listed on IDEAS
    19. Alberto Bayo-Moriones & Pedro Ortín-Ángel, 2003. "Internal Promotion Versus External Recruitment: Evidence in Industrial Plants," Working Papers 0303, Departament Empresa, Universitat Autònoma de Barcelona, revised Mar 2003.
    20. Jin, Xin, 2014. "The Signaling Role of Note Being Promoted: Theory and Evidence," MPRA Paper 58484, University Library of Munich, Germany.
    21. Alan Manning & Joanna Swaffield, 2008. "The gender gap in early-career wage growth," Economic Journal, Royal Economic Society, vol. 118(530), pages 983-1024, July.
    22. Danilo Coelho & Marcelo Fernandes e Miguel N. Foguel, 2009. "Capital Estrangeiro e Diferenciais de Gênero nas Promoções: Evidências da Indústria de Transformação Brasileira," Discussion Papers 1447, Instituto de Pesquisa Econômica Aplicada - IPEA.
    23. Boris Hirsch & Claus Schnabel, 2012. "Women Move Differently: Job Separations and Gender," Journal of Labor Research, Springer, vol. 33(4), pages 417-442, December.

    More about this item

    NEP fields

    This paper has been announced in the following NEP Reports:

    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:ese:iserwp:2009-11. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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: Jonathan Nears (email available below). General contact details of provider: https://edirc.repec.org/data/rcessuk.html .

    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.