Within- and Cross-Firm Mobility and Earnings Growth

38 Pages Posted: 7 Sep 2010

See all articles by Anders Frederiksen

Anders Frederiksen

IZA Institute of Labor Economics

Timothy Halliday

University of Hawaii - Department of Economics; IZA Institute of Labor Economics

Alexander K. Koch

University of Aarhus - Department of Economics and Business Economics; IZA Institute of Labor Economics

Abstract

While it is well established that both promotions within firms and mobility across firms lead to significant earnings progression, little is known about the interaction between these types of mobility. Exploiting a large Danish panel data set and controlling for unobserved individual heterogeneity, we show that cross-firm moves at the non-executive level provide sizeable short-run gains (similar to the effect of a promotion), consistent with the existing literature. These gains, however, appear modest when compared with the persistent impact on earnings growth of promotions (either within or across firms) and subsequent mobility at a higher hierarchy level.

Keywords: earnings growth, promotions, dynamic panel data models, matched employer-employee data

JEL Classification: C33, J6, M51

Suggested Citation

Frederiksen, Anders and Halliday, Timothy and Koch, Alexander K., Within- and Cross-Firm Mobility and Earnings Growth. IZA Discussion Paper No. 5163. Available at SSRN: https://ssrn.com/abstract=1672171

Anders Frederiksen (Contact Author)

IZA Institute of Labor Economics ( email )

P.O. Box 7240
Bonn, D-53072
Germany

Timothy Halliday

University of Hawaii - Department of Economics ( email )

Honolulu, HI 96822
United States

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Alexander K. Koch

University of Aarhus - Department of Economics and Business Economics ( email )

Fuglesangs Allé 4
Aarhus V, 8210
Denmark

HOME PAGE: http://https://sites.google.com/site/alexanderkkoch/Home

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

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