Competition and Career Advancement: The Hidden Costs of Paid Leave

Arbeitspapier

Does leave-taking matter for young workers' careers? If so, why? We propose the competition effect—relative leave status of workers affecting their relative standing inside the firm—as a new explanation. Exploiting a policy reform that exogenously assigned four-week paid paternity leave to some new fathers, we find evidence consistent with the competition effect: A worker enjoys a better post-child earnings trajectory when a larger share of his colleagues take leave because of the policy. In contrast, we find no direct earnings effect resulting from the worker's own leave when controlling for their relative leave eligibility status within the firm.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: IZA Discussion Papers ; No. 13596

Classification and Topics

• Classification: Wirtschaft ; Personnel Economics: Firm Employment Decisions; Promotions ; Personnel Economics: Compensation and Compensation Methods and Their Effects ; Economics of Gender; Non-labor Discrimination ; Time Allocation and Labor Supply ; Human Capital; Skills; Occupational Choice; Labor Productivity ; Wage Level and Structure; Wage Differentials
• Subject: leave of absence ; career interruptions ; ranking ; tournament ; promotion ; gender gap

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Johnsen, Julian V. ; Ku, Hyejin ; Salvanes, Kjell G.
• Event: Veröffentlichung
• (who): Institute of Labor Economics (IZA)
• (where): Bonn
• (when): 2020

Further information

• Handle: http://hdl.handle.net/10419/224038
• Last update: 10.03.2025, 11:43 AM CET