Employee Poaching: Why It Can Be Predatory

Jin-Hyuk Kim ()

Managerial and Decision Economics, 2014, vol. 35, issue 5, 309-317

Abstract: There is a growing concern over predatory hiring practices that are aimed at eliminating competitors. Using a duopoly model in which firm's profits depend on the quality of the worker–employer match, this paper studies the conditions under which predatory equilibrium exists. I find that predatory hiring can occur when the match between the worker and the new employer is relatively poor, and the old employer has a shallow pool of replacement candidates. Post‐employment lawsuits do not affect the range of predatory equilibrium if the parties take into account expected damages payment. Copyright © 2013 John Wiley & Sons, Ltd.

Date: 2014
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