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Social network structure, segregation, and equality in a labor market with referral hiring

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  • Tassier, Troy
  • Menczer, Filippo

Abstract

We examine the effects of social network structure on inequality in a model of referral hiring that focuses on groups rather than individuals. More random social networks yield higher employment rates than less random ones if the population is integrated or job vacancy information flows are random. However less random social networks allow for better containment of job information inside a group in a segregated population with non-random job information flows, resulting in higher employment rates. We report on the robustness of these findings with respect to the size of minority and majority groups and the amount of social segregation.

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Bibliographic Info

Article provided by Elsevier in its journal Journal of Economic Behavior & Organization.

Volume (Year): 66 (2008)
Issue (Month): 3-4 (June)
Pages: 514-528

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Handle: RePEc:eee:jeborg:v:66:y:2008:i:3-4:p:514-528

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  1. Farley, Reynolds, 1990. "Blacks, Hispanics, and White Ethnic Groups: Are Blacks Uniquely Disadvantaged?," American Economic Review, American Economic Association, vol. 80(2), pages 237-41, May.
  2. Antoni Calv├│-Armengol & Matthew O. Jackson, 2004. "The Effects of Social Networks on Employment and Inequality," American Economic Review, American Economic Association, vol. 94(3), pages 426-454, June.
  3. Smith, James P & Welch, Finis R, 1989. "Black Economic Progress after Myrdal," Journal of Economic Literature, American Economic Association, vol. 27(2), pages 519-64, June.
  4. George J. Mailath & Larry Samuelson & Avner Shaked, . ""Endogenous Inequality in Integrated Labor Markets with Two-sided Search''," CARESS Working Papres 98-06, University of Pennsylvania Center for Analytic Research and Economics in the Social Sciences.
  5. David Card & Alan Krueger, 1990. "School Quality and Black/White Relative Earnings: A Direct Assessment," Working Papers 652, Princeton University, Department of Economics, Industrial Relations Section..
  6. Calvo-Armengol, Antoni, 2004. "Job contact networks," Journal of Economic Theory, Elsevier, vol. 115(1), pages 191-206, March.
  7. Yannis M. Ioannides & Linda Datcher Loury, 2004. "Job Information Networks, Neighborhood Effects, and Inequality," Journal of Economic Literature, American Economic Association, vol. 42(4), pages 1056-1093, December.
  8. O'Regan Katherine M. & Quigley John M., 1993. "Family Networks and Youth Access to Jobs," Journal of Urban Economics, Elsevier, vol. 34(2), pages 230-248, September.
  9. Troy Tassier, 2006. "Labor Market Implications of Weak Ties," Southern Economic Journal, Southern Economic Association, vol. 72(3), pages 704-719, January.
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Cited by:
  1. Matthew O. Jackson, 2003. "A survey of models of network formation: Stability and efficiency," Working Papers 1161, California Institute of Technology, Division of the Humanities and Social Sciences.
  2. Yannis M. Ioannides & Linda Datcher Loury, 2002. "Job Information Networks, Neighborhood Effects and Inequality," Discussion Papers Series, Department of Economics, Tufts University 0217, Department of Economics, Tufts University.
  3. Alessandra Casella & Nobuyuki Hanaki, 2005. "Information channels in labor markets: On the resilience of referral hiring," Discussion Papers 0506-05, Columbia University, Department of Economics.
  4. De Kamps, Marc & Ladley, Daniel & Simaitis, Aistis, 2014. "Heterogeneous beliefs in over-the-counter markets," Journal of Economic Dynamics and Control, Elsevier, vol. 41(C), pages 50-68.
  5. Michael Neugart & Matteo G. Richiardi, 2012. "Agent-based models of the labor market," LABORatorio R. Revelli Working Papers Series 125, LABORatorio R. Revelli, Centre for Employment Studies.
  6. Simon Gemkow & Michael Neugart, 2011. "Referral hiring, endogenous social networks, and inequality: an agent-based analysis," Journal of Evolutionary Economics, Springer, vol. 21(4), pages 703-719, October.
  7. Mohamed Abdou & Nigel Gilbert, 2009. "Modelling the emergence and dynamics of social and workplace segregation," Mind and Society: Cognitive Studies in Economics and Social Sciences, Fondazione Rosselli, vol. 8(2), pages 173-191, December.

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