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Talent discovery and poaching under asymmetric information

Ferreira, Daniel and Nikolowa, Radoslawa (2023) Talent discovery and poaching under asymmetric information. Economic Journal, 133 (649). 201 - 234. ISSN 0013-0133

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Identification Number: 10.1093/ej/ueac048

Abstract

We develop a model of the market for knowledge workers in which talent is discovered on the job. In the model, asymmetric information and firm-specific human capital combine to generate several predictions relating firm heterogeneity to talent discovery and poaching. We show that high-quality (i.e., large and high-productivity) firms are more likely to become talent poachers, while lower-quality firms are more likely to invest in talent discovery. Job-to-job flows are adversely selected, which implies that internally promoted managers are more productive than those who are externally promoted. The model generates several additional predictions linking firm heterogeneity to the distribution of managerial talent, productivity, compensation and promotions.

Item Type: Article
Official URL: https://academic.oup.com/ej
Additional Information: © 2022 The Author(s).
Divisions: Finance
Subjects: H Social Sciences > HB Economic Theory
JEL classification: D - Microeconomics > D8 - Information, Knowledge, and Uncertainty > D82 - Asymmetric and Private Information
Date Deposited: 19 Aug 2022 11:00
Last Modified: 09 Jun 2024 18:12
URI: http://eprints.lse.ac.uk/id/eprint/116044

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