Career Spillovers in Internal Labour Markets

Nicola Bianchi, Giulia Bovini, Jin Li, Matteo Paradisi, Michael Powell

Research output: Contribution to journalArticlepeer-review

2 Scopus citations

Abstract

This article studies career spillovers across workers, which arise in firms with limited promotion opportunities. We exploit a 2011 Italian pension reform that unexpectedly tightened eligibility criteria for the public pension, leading to sudden, substantial, and heterogeneous retirement delays. Using administrative data on Italian private-sector workers, the analysis leverages cross-firm variation to isolate the effect of retirement delays among soon-to-retire workers on the wage growth and promotions of their colleagues. We find evidence of spillover patterns consistent with older workers blocking the careers of their younger colleagues, but only in firms with limited promotion opportunities.

Original languageEnglish (US)
Pages (from-to)1800-1831
Number of pages32
JournalReview of Economic Studies
Volume90
Issue number4
DOIs
StatePublished - Jul 1 2023

Keywords

  • Internal labour markets
  • J21
  • J26
  • J31
  • M51
  • M52
  • Pension reform
  • Promotions
  • Wage growth

ASJC Scopus subject areas

  • Economics and Econometrics

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