Research

Abstract: This paper studies the labor market for managers by examining both between and within firm reallocation channels. I document that around 40% of the inflows into managerial positions come from internal promotions, a flow comparable in size to the job-to-job transitions into the same roles. I develop a labor search model with internal reallocation and on-the-job learning. External flows depend on how firms are currently internally organized. Internal flows depend on the extent of skill accumulation of workers under managers and on external hiring and separation events. Using administrative data from Germany, I document that managers receive a substantial wage premium and play a key role in the skill development of workers within the establishment. The model matches observed external and internal flows into managerial positions and provides insights into how these channels operate across the talent distribution. Lastly, I evaluate policy implications of targeted Non-Compete Agreements, finding that restrictions on managers lead to fast-tracked promotions and reduced output, whereas non-competes on workers enhance skill accumulation and increase productivity.

Abstract: We develop a model of search in OTC markets with asymmetric information and trade occurring under double-sided uncertainty over asset quality, where holding the asset does not necessarily translate into knowing its quality. This leads to deterioration of market information conditions over subsequent trades, causing both sellers and buyers to become more pessimistic even though aggregate asset quality remains unchanged. If re-trade opportunities are frequent, information in the economy becomes coarser, hindering market liquidity and volume of trade.

Abstract: This paper explores how firm organizational structure influences internal market power and wage dispersion across firms occupational layers. In complex firms, talent is distributed across multiple layers, from lower-level workers whose effective productivity primarily depends on their individual skills, to top-level managers whose productivity significantly impacts the entire firm. Recognizing this, firms may optimally choose wage structures featuring higher compensation at upper layers, reflecting managers' broader influence on overall productivity, while potentially imposing markdowns on lower-level positions. By explicitly modeling these internal firm structures, we analyze how such mechanisms shape within-firm wage inequality, internal allocation of talent, and overall productivity. Additionally, the framework sheds light on how internal reallocation interacts with external labor market pressures.

Abstract: Managerial talent influences firm growth and expansion, yet larger firms may have an advantage in mitigating managerial turnover by sourcing replacements internally. This paper examines the relationship between manager allocation and firm size. Using German administrative data, I document that internal promotions account for 40% of managerial inflows, disproportionately concentrated in larger firms. Event study regressions show that external managerial hires are associated with firm growth, while internal promotions have a more muted effect on size. To rationalize these findings, I develop a firm dynamics model with frictional search for managerial positions, where firms optimally choose their size while accounting for manager turnover. The model shows that reliance on internal or external hires depends critically on firm size, influencing both talent distribution and firm productivity.