Careers and Wage Growth within Large Firms

Francisco Lima and Pedro Pereira

No 336, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: The relationship between the worker’s career path and wage growth is studied using a longitudinal sample of large firms. The econometric analysis shows that promoted workers receive a positive wage premium even if they stay in the same job level. Demotions are associated with negative wage premiums. The wage-career dynamics generates a U-shape to the wage premiums for promotions over the hierarchical ladder. In the context of the model discussed, this shape suggests a stronger learning and/or human capital accumulation effect at the bottom of the hierarchy and a stronger job assignment effect at the top.

Keywords: wage growth; promotions; Careers (search for similar items in EconPapers)
JEL-codes: J32 J33 M12 (search for similar items in EconPapers)
Pages: 51 pages
Date: 2001-07
New Economics Papers: this item is included in nep-lab and nep-mic
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (17)

Published - published in: International Journal of Manpower, 2003, 7 (24), 812-835

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