AN OPTIONS-BASED MODEL OF CAREER MOBILITY IN PROFESSIONAL SERVICE FIRMS

Contemporary career mobility models do not fully explain up-or-out pro motional systems in professional service firms (PSFs), We propose ct P SF career mobility model, which represents hiring decisions as investm ents in options on future human capital acquisitions and promotions as exercise of those options. Promotional outcomes depend mainly on the development of employee's human capital and business conditions at the time of partnership consideration. The model explains seemingly parad oxical firm behavior, such as dismissal of nonpromoted but productive employees.