Stepping Stone Mobility

41 Pages Posted: 25 Sep 1996 Last revised: 11 Jun 2020

See all articles by Boyan Jovanovic

Boyan Jovanovic

New York University - Department of Economics

Yaw Nyarko

New York University - Leonard N. Stern School of Business - Department of Economics

Date Written: July 1996

Abstract

People at the top of an occupational ladder earn more partly because they have spent time on lower rungs, where they have learned something. But what precisely do they learn? There are two contrasting views: First, the Bandit model assumes that people are different, that experience reveals their characteristics, and that consequently an occupational switch can result. Second, in our Stepping Stone model, experience raises a worker's productivity on a given task and the acquired skill can in part be transferred to other occupations, and this prompts movement. Safe activities (where mistakes destroy less output) are a natural training ground.

Suggested Citation

Jovanovic, Boyan and Nyarko, Yaw, Stepping Stone Mobility (July 1996). NBER Working Paper No. w5651, Available at SSRN: https://ssrn.com/abstract=3352

Boyan Jovanovic (Contact Author)

New York University - Department of Economics ( email )

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New York, NY 10012
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Yaw Nyarko

New York University - Leonard N. Stern School of Business - Department of Economics ( email )

269 Mercer Street
New York, NY 10003
United States
212-998-8928 (Phone)
212-995-4186 (Fax)