Motivating Employees Through Career Paths
30 Pages Posted: 2 Jul 2019 Last revised: 14 Nov 2019
Date Written: June 26, 2019
Firms have discretion over task allocations, which may dampen employees' career prospects, and, hence, motivation. Task assignments and worker motivation interact through the extent of labor market competition; that is, the possibility of moving to another firm. More competition enhances motivation but decreases firms' incentives to assign workers to informative tasks. One consequence is that competitive firms sometimes choose strategies that lead to intermediate competition. When the employee pool is heterogeneous, firms might choose different human resources practices that attract different kinds of workers, and differentiate themselves through the career opportunities within and beyond the firms that they offer.
Keywords: career concerns, task assignments, labour market competition, professional service firms
JEL Classification: J32, M50, M52
Suggested Citation: Suggested Citation