Internal Vs. External Promotions: Evidence from Professional Football Coaching Careers

48 Pages Posted: 18 Dec 2002  

C. Edward Fee

Tulane University - A.B. Freeman School of Business

Charles J. Hadlock

Michigan State University - The Eli Broad College of Business and The Eli Broad Graduate School of Management

Joshua R. Pierce

University of Kentucky - Gatton College of Business and Economics

Date Written: November 8, 2002

Abstract

We examine the job movements of professional football coaches both within and across employers and compare the mechanisms governing internal and external promotions. We find that the likelihood of an external promotion is strongly related to individual performance measures and only weakly related to team performance. In contrast to external promotions, we find that the overall likelihood of an internal promotion is unrelated to an individual's performance. This difference between internal and external labor markets appears to arise from the process governing job openings within the internal hierarchy, as the likelihood of an internal job opening up is negatively related to performance. Conditional on an internal opening occurring, we do find that increases in individual performance increase the probability of being promoted. Relationships matter a great deal in this labor market in the sense that coaches appear to be fired and hired as a group, suggesting that the value of an individual to an employer depends on the identity of the entire set of individuals who work together. We argue that our findings have implications for several issues related to incentives and organizational design.

Keywords: Promotions, Internal Labor Markets, Hierarchies, Performance Evaluation, Careers, Football, Teams

JEL Classification: D23, J41, L22, L83

Suggested Citation

Fee, C. Edward and Hadlock, Charles J. and Pierce, Joshua R., Internal Vs. External Promotions: Evidence from Professional Football Coaching Careers (November 8, 2002). Available at SSRN: https://ssrn.com/abstract=350901 or http://dx.doi.org/10.2139/ssrn.350901

C. Edward Fee (Contact Author)

Tulane University - A.B. Freeman School of Business ( email )

7 McAlister Drive
New Orleans, LA 70118
United States

Charles J. Hadlock

Michigan State University - The Eli Broad College of Business and The Eli Broad Graduate School of Management ( email )

315 Eppley Center
East Lansing, MI 48824-1121
United States
517-353-9330 (Phone)
517-432-1080 (Fax)

Joshua R. Pierce

University of Kentucky - Gatton College of Business and Economics ( email )

550 South Limestone
Lexington, KY 40506
United States
859-257-2882 (Phone)
859-257-9688 (Fax)

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