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Competition and Career Advancement:The Hidden Costs of Paid Leave

Julian Johnsen (), Hyejin Ku () and Kjell G Salvanes ()

No 2017, CReAM Discussion Paper Series from Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London

Abstract: Does leave-taking matter for young workers’ careers? If so, why? We propose the competition effect—relative leave status of workers affecting their relative standing inside the firm—as a new explanation. Exploiting a policy reform that exogenously assigned four-week paid paternity leave to some new fathers, we find evidence consistent with the competition effect: A worker enjoys a better post-child earnings trajectory when a larger share of his colleagues take leave because of the policy. In contrast, we find no direct earnings effect resulting from the worker’s own leave when controlling for their relative leave eligibility status within the firm.

Keywords: leave of absence; career interruptions; ranking; tournament; promotion; gender gap (search for similar items in EconPapers)
JEL-codes: J16 J22 J24 J31 M51 M52 (search for similar items in EconPapers)
Date: 2020-08
New Economics Papers: this item is included in nep-dem, nep-isf and nep-ore
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Related works:
Working Paper: Competition and Career Advancement: The Hidden Costs of Paid Leave (2020) Downloads
Working Paper: Competition and Career Advancement: The Hidden Costs of Paid Leave (2020) Downloads
Working Paper: Competition and Career Advancement: The Hidden Costs of Paid Leave (2020) Downloads
Working Paper: Competition and Career Advancement: The Hidden Costs of Paid Leave (2020) Downloads
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