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Learning on the Job? Employee mobility in the asset management industry

Publication ,  Journal Article
Chatterji, AK; De Figueiredo, RJP; Rawley, E
Published in: Management Science
October 1, 2016

We present a new mechanism by which prior employment can influence transitions to other firms. We propose that some employees divert effort toward unproductive activities to learn about their own fitness for alternative employment. Based on the results of this costly learning experience, or "experiment," some employees will transition into other firms or launch their own ventures, whereas others will remain at the incumbent firm. We develop a theoretical model to explicate these propositions and test them using four data sets from the mutual fund and hedge fund industries. We find evidence that managers who engage in excessive risk taking at mutual funds are subsequently more likely to join or start hedge funds, although there is little evidence that this risk taking is intended to signal quality to outside observers. Taken together, our findings suggest that learning about one's own fitness for alternative employment, through experimentation on the job, is an important mechanism for enabling employee mobility.

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Published In

Management Science

DOI

EISSN

1526-5501

ISSN

0025-1909

Publication Date

October 1, 2016

Volume

62

Issue

10

Start / End Page

2805 / 2819

Related Subject Headings

  • Operations Research
  • 46 Information and computing sciences
  • 38 Economics
  • 35 Commerce, management, tourism and services
  • 15 Commerce, Management, Tourism and Services
  • 08 Information and Computing Sciences
 

Citation

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Chatterji, A. K., De Figueiredo, R. J. P., & Rawley, E. (2016). Learning on the Job? Employee mobility in the asset management industry. Management Science, 62(10), 2805–2819. https://doi.org/10.1287/mnsc.2015.2276
Chatterji, A. K., R. J. P. De Figueiredo, and E. Rawley. “Learning on the Job? Employee mobility in the asset management industry.” Management Science 62, no. 10 (October 1, 2016): 2805–19. https://doi.org/10.1287/mnsc.2015.2276.
Chatterji AK, De Figueiredo RJP, Rawley E. Learning on the Job? Employee mobility in the asset management industry. Management Science. 2016 Oct 1;62(10):2805–19.
Chatterji, A. K., et al. “Learning on the Job? Employee mobility in the asset management industry.” Management Science, vol. 62, no. 10, Oct. 2016, pp. 2805–19. Scopus, doi:10.1287/mnsc.2015.2276.
Chatterji AK, De Figueiredo RJP, Rawley E. Learning on the Job? Employee mobility in the asset management industry. Management Science. 2016 Oct 1;62(10):2805–2819.

Published In

Management Science

DOI

EISSN

1526-5501

ISSN

0025-1909

Publication Date

October 1, 2016

Volume

62

Issue

10

Start / End Page

2805 / 2819

Related Subject Headings

  • Operations Research
  • 46 Information and computing sciences
  • 38 Economics
  • 35 Commerce, management, tourism and services
  • 15 Commerce, Management, Tourism and Services
  • 08 Information and Computing Sciences