Monkey Bars and Ladders: The Importance of Lateral and Vertical Movements in Internal Labor Market Careers

T.J. Dohmen, B. Kriechel, G.A. Pfann

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Abstract

This paper compares results from the empirical literature on internal labor markets with outcomes from analyzing personnel data of the dutch aircraft manufacturer fokker. It sheds light on differences in the functioning of internal labor markets between periods of workforce growth and decline. Despite substantial variation in individual wages, careers are important as wages are strongly related to job levels. Promotion rates fall and demotion rates rise when the firm enters the stage of demise. Vertical and lateral job mobility are important in internal labor market careers as they stimulate wage growth and reduce the lay-off risk.
Original languageEnglish
Pages (from-to)193-228
JournalJournal of Population Economics
Volume17
Issue number2
DOIs
Publication statusPublished - 1 Jan 2004

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