Returns to human capital for information technology professionals

ABSTRACT

This study examines compensation-tenure profiles using detailed salary data collected on IT professionals. Consistent with human capital theory, findings show that compensation increases with organizational tenure for all IT jobs. However, for a given level of organizational tenure, individuals in IT jobs requiring more firm-specific human capital are paid more on average than those in IT jobs requiring less-firm specific human capital. Our results suggest the importance of job type in examining compensation-tenure profiles in IT where the value of technical human capital can diminish while the value of firm-specific human capital can appreciate with organizational tenure.

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INDEX TERMS

Keywords:
human capital theory, information technology compensation, organizational tenure