Strategic recruiting in ongoing hierarchies

Susanne Goldlücke

Economics Letters, 2017, vol. 156, issue C, 176-178

Abstract: This paper describes a hierarchy with peer hiring to explore the reasons behind the management rule “A’s hire A’s and B’s hire C’s”. Workers are promoted based on talent and therefore like to hire less talented co-workers. This is why B’s hire C’s. The same logic should cause A’s to hire B’s, but there is a trade-off in the model: A’s are more likely to be promoted, and a manager profits from more talented subordinates. If this effect is strong enough, then indeed A’s hire A’s.

Keywords: Peer hiring; Hierarchies; Promotions (search for similar items in EconPapers)
JEL-codes: D23 J41 M51 (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:156:y:2017:i:c:p:176-178

DOI: 10.1016/j.econlet.2017.05.011

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