The Internal Economics of a University - Evidence from Personnel Data

Frank Verboven and Catherine Haeck

No 7843, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: Based on a rich personnel data set of a large university we find strong evidence for the existence of an internal labor market. First, the lowest academic rank is a strong port of entry and the highest rank is a port of exit. Second, wages do not follow external wage developments, since they follow administrative rules that have not been modified for a long time. We subsequently look at internal promotion dynamics to assess the relevance of alternative internal labor market theories. A unique feature of our data is that we have good measures of performance. Consistent with incentive theories of internal labor markets, research and teaching performance turn out to be crucial determinants of promotion dynamics. Learning theories of internal labor markets appear to have support when we do not account for observed performance, but the evidence becomes much weaker once we control for performance. Finally, we find that administrative rigidities play an important role in explaining promotion dynamics.

Keywords: Career dynamics; Incentives; Learning; Personnel economics (search for similar items in EconPapers)
JEL-codes: J30 J31 J45 (search for similar items in EconPapers)
Date: 2010-05
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Citations: View citations in EconPapers (1)

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Related works:
Journal Article: The Internal Economics of a University: Evidence from Personnel Data (2012)
Working Paper: The internal economics of a university - evidence from personnel data (2010)
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