Human Capital Portability and Worker Career Choices: Evidence from M&A Bankers

64 Pages Posted: 23 Nov 2020 Last revised: 6 Oct 2021

See all articles by Janet Gao

Janet Gao

Indiana University - Kelley School of Business

Wenyu Wang

Indiana University - Kelley School of Business - Department of Finance

Yufeng Wu

University of Illinois at Urbana-Champaign - Department of Finance

Date Written: October 1, 2021

Abstract

How does firm-specific human capital shape workers’ career trajectories? We develop a model that allows workers to accumulate both portable and non-portable (firm-specific) human capital through their work experience and learn about their match quality with current employers over time. The model is estimated using granular data on M&A bankers. We show that bankers accumulate a significant fraction of non-portable human capital, and this non-portability influences their productivity, job turnover, and career choices between sectors offering high returns on human capital and sectors offering generalizable skills. Our results have implications for high-skill workers in human capital-intensive industries in general.

Keywords: labor mobility, human capital portability, career path, M&A advisor

JEL Classification: C51, G24, J60, L22

Suggested Citation

Gao, Janet and Wang, Wenyu and Wu, Yufeng, Human Capital Portability and Worker Career Choices: Evidence from M&A Bankers (October 1, 2021). Available at SSRN: https://ssrn.com/abstract=3724657 or http://dx.doi.org/10.2139/ssrn.3724657

Janet Gao

Indiana University - Kelley School of Business ( email )

1309 East Tenth Street
Indianapolis, IN 47405-1701
United States

Wenyu Wang (Contact Author)

Indiana University - Kelley School of Business - Department of Finance ( email )

1309 E. 10th St.
Bloomington, IN 47405
United States

Yufeng Wu

University of Illinois at Urbana-Champaign - Department of Finance ( email )

1206 South Sixth Street
Champaign, IL 61820
United States

HOME PAGE: http://https://business.illinois.edu/profile/yufeng-wu2/

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