Belzil, Christian, Bognanno, Michael and Poinas, François (2012) Promotion Determinants in Corporate Hierarchies: An Examination of Fast Tracks and Functional Area. TSE Working Paper, n. 12-348, Toulouse

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Abstract

This article estimates a dynamic reduced-form model of intra-firm promotions using an
employer-employee panel of over 300 of the largest corporations in the U.S. in the period
from 1981 to 1988. The estimation conditions on unobserved individual heterogeneity and
allows for both an endogenous initial condition and sample attrition linked to individual
heterogeneity in demonstrating the relative importance of variables that influence promotion.
The role of the executive's functional area in promotion is considered along with the
existence and source of promotion fast tracks. We find that while the principal determinant of
promotions is unobserved individual heterogeneity, functional area has a high explanatory
power, resulting in promotion probabilities that differ by functional area for executives at the
same reporting level and firm. No evidence is found that an executive's recent speed of
advancement in pay grade has a causal impact on in- sample promotions after conditioning
on the executive's career speed of advancement. For high-level executives, fast tracks
appear to result from heterogeneity in persistent individual characteristics, not from an
inherent benefit in recent advancement itself.

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• Promotion Determinants in Corporate Hierarchies: An Examination of Fast Tracks and Functional Area. (deposited 09 Jul 2014 17:30) [Currently Displayed]
  • Promotion Determinants in Corporate Hierarchies: An Examination of Fast Tracks and Functional Area. (deposited 27 Aug 2018 13:14)