Why do firms opt for internal labor markets when they may be able to find more candidates with necessary qualifications outside?
In a firm where team production prevails and employer-specific human capital is important, the classification of workers into job slots reduces the costs of evaluating productivity and adjusting pay. Such a firm may choose to promote persons through an internal labor market rather than considering outside candidates. An internal labor market facilitates comparisons between candidates for a promotion. Unlike outside applicants, their on-the-job conduct can be easily observed and their records are kept as part of ordinary company business.
You might also like to view...
In the United States, the government agency requiring that firms that sell securities in public markets adhere to standard accounting principles and disclose information about their sales, assets, and earnings is the
A) Federal Communications Commission. B) Federal Trade Commission. C) Securities and Exchange Commission. D) Federal Reserve System.
In long-run equilibrium, the perfectly competitive firm produces
a. where P = MC = AC. b. at the lowest point on its long-run average cost curve. c. where its long-run average cost curve is tangent to its horizontal demand curve. d. All of the above are correct.
Nominal wage confusion occurs when
What will be an ideal response?
You are considering renting a car for the weekend. It costs $200 for the car plus $0.20 per mile (including gas). Suppose you have already rented the car for the week and then add the 300 mile addition to your trip. Now what is the cost of the journey?
A. $100 B. $260 C. $0 D. $60