Promotion: Turnover and Preemptive Wage Offers
This paper examines the strategic promotion and wage decisions of employers when employees may be more valuable to competing firms, even in the presence of firm specific human capital. Competing employers must incur a cost to learn the quality of their match with a manager. Because promotion signal that workers are potentially valuable managers in other firms, it can induce turnover. To preempt competition for a promoted worker, an employer may offer a wage so high that it discourages competitors from acquiring information and bidding up the wage further or hiring the worker away. Also, to avoid competition, employers will fail to promote some less well-matched workers who should be promoted.
|Date of creation:||May 1991|
|Date of revision:|
|Contact details of provider:|| Postal: |
Phone: (613) 533-2250
Fax: (613) 533-6668
Web page: http://qed.econ.queensu.ca/
More information through EDIRC
When requesting a correction, please mention this item's handle: RePEc:qed:wpaper:817. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mark Babcock)
If references are entirely missing, you can add them using this form.