Who Gets the Job Referral? Evidence from a Social Networks Experiment
AbstractWe use recruitment into a laboratory experiment in Kolkata, India to analyze how social networks select individuals for jobs. The experiment allows subjects to refer actual network members for casual jobs as experimental subjects under exogenously varied incentive contracts. We provide evidence that some workers, those who are high ability, have useful information about the abilities of members of their social network. However, the experiment also shows that social networks provide incentives to refer less qualified workers, and firms must counterbalance these incentives in order to effectively use existing employees to help overcome their screening problem.
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Bibliographic InfoArticle provided by American Economic Association in its journal American Economic Review.
Volume (Year): 102 (2012)
Issue (Month): 7 (December)
Find related papers by JEL classification:
- C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
- D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
- O12 - Economic Development, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
- Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Social and Economic Stratification
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