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Social Ties and the Job Search of Recent Immigrants

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Author Info

  • Deepti Goel

    (Department of Economics, Delhi School of Economics, Delhi, India)

  • Kevin Lang

    (Boston University and NBER, IZA)

Abstract

We show that increasing the probability of obtaining a job offer through the network should raise the observed mean wage in jobs found through formal (non-network) channels relative to that in jobs found through the network. This prediction also holds at all percentiles of the observed wage distribution, except the highest and lowest. The largest changes are likely to occur below the median. We test and con rm these implications using a survey of recent immigrants to Canada. We also develop a simple structural model, consistent with the theoretical model, and show that it can replicate the broad patterns in the data. For recent immigrants, our results are consistent with the primary effect of strong networks being to increase the arrival rate of offers rather than to alter the distribution from which offers are drawn.

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Bibliographic Info

Paper provided by Centre for Development Economics, Delhi School of Economics in its series Working papers with number 189.

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Length: 29 pages
Date of creation: Sep 2010
Date of revision:
Handle: RePEc:cde:cdewps:189

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References

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  1. Patel, Krishna & Vella, Francis, 2007. "Immigrant Networks and Their Implications for Occupational Choice and Wages," IZA Discussion Papers 3217, Institute for the Study of Labor (IZA).
  2. Edward E. Glaeser & Bruce Sacerdote & Jose A. Scheinkman, 1995. "Crime and Social Interactions," Harvard Institute of Economic Research Working Papers 1738, Harvard - Institute of Economic Research.
  3. Marianne Bertrand & Erzo F. P. Luttmer & Sendhil Mullainathan, 1999. "Network Effects and Welfare Cultures," Working Papers 9903, Harris School of Public Policy Studies, University of Chicago.
  4. Uta Schoenberg & Albrecht Glitz & Christian Dustmann, 2011. "Referral-based Job Search Networks," 2011 Meeting Papers 350, Society for Economic Dynamics.
  5. Michele Pellizzari, 2004. "Do Friends and Relatives Really Help in Getting a Good Job?," CEP Discussion Papers dp0623, Centre for Economic Performance, LSE.
  6. Edward P. Lazear, 1999. "Culture and Language," Journal of Political Economy, University of Chicago Press, vol. 107(S6), pages S95-S126, December.
  7. Picot, Garnett Sweetman, Arthur, 2005. "The Deteriorating Economic Welfare of Immigrants and Possible Causes: Update 2005," Analytical Studies Branch Research Paper Series 2005262e, Statistics Canada, Analytical Studies Branch.
  8. Marmaros, David & Sacerdote, Bruce, 2002. "Peer and social networks in job search," European Economic Review, Elsevier, vol. 46(4-5), pages 870-879, May.
  9. Adriana Kugler, 2002. "Employee referrals and efficiency wages," Economics Working Papers 647, Department of Economics and Business, Universitat Pompeu Fabra.
  10. Samuel Bentolila & Claudio Michelacci & Javier Suarez, 2004. "Social Contacts And Occupational Choice," Working Papers wp2004_06, CEMFI.
  11. Patrick Bayer & Stephen L. Ross & Giorgio Topa, 2008. "Place of Work and Place of Residence: Informal Hiring Networks and Labor Market Outcomes," Journal of Political Economy, University of Chicago Press, vol. 116(6), pages 1150-1196, December.
  12. Edin, Per-Anders & Fredriksson, Peter & Åslund, Olof, 2000. "Ethnic enclaves and the economic success of immigrants - evidence from a natural experiment," Working Paper Series 2000:9, IFAU - Institute for Evaluation of Labour Market and Education Policy.
  13. Kaivan Munshi, 2003. "Networks In The Modern Economy: Mexican Migrants In The U.S. Labor Market," The Quarterly Journal of Economics, MIT Press, vol. 118(2), pages 549-599, May.
  14. Hou, Feng Picot, Garnett, 2003. "Visible Minority Neighbourhood Enclaves and Labour Market Outcomes of Immigrants," Analytical Studies Branch Research Paper Series 2003204e, Statistics Canada, Analytical Studies Branch.
  15. Lori A. Beaman, 2012. "Social Networks and the Dynamics of Labour Market Outcomes: Evidence from Refugees Resettled in the U.S," Review of Economic Studies, Oxford University Press, vol. 79(1), pages 128-161.
  16. George J. Borjas, 1991. "Ethnic Capital and Intergenerational Mobility," NBER Working Papers 3788, National Bureau of Economic Research, Inc.
  17. Hellerstein, Judith K. & McInerney, Melissa & Neumark, David, 2008. "Measuring the Importance of Labor Market Networks," IZA Discussion Papers 3750, Institute for the Study of Labor (IZA).
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Citations

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Cited by:
  1. Eleonora Patacchini & Yves Zenou, 2012. "Ethnic Networks and Employment Outcomes," CReAM Discussion Paper Series 1202, Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London.
  2. Cappellari, Lorenzo & Tatsiramos, Konstantinos, 2010. "Friends' Networks and Job Finding Rates," IZA Discussion Papers 5240, Institute for the Study of Labor (IZA).
  3. Tommaso Colussi, 2013. "Migrant Networks and Job Search Outcomes: Evidence from Displaced Workers," Working Papers 706, Queen Mary, University of London, School of Economics and Finance.
  4. Dustmann, Christian & Glitz, Albrecht & Schönberg, Uta, 2011. "Referral-based Job Search Networks," IZA Discussion Papers 5777, Institute for the Study of Labor (IZA).
  5. Arceo-Gómez, Eva Olimpia, 2012. "Job Search, Networks, and Labor Market Performance of Immigrants," MPRA Paper 44533, University Library of Munich, Germany.
  6. Audra J. Bowlus & Masashi Miyairi & Chris Robinson, 2013. "Immigrant Job Search Assimilation in Canada," University of Western Ontario, CIBC Centre for Human Capital and Productivity Working Papers 20136, University of Western Ontario, CIBC Centre for Human Capital and Productivity.
  7. Nicodemo, Catia & Nicolini, Rosella, 2012. "Random or Referral Hiring: When Social Connections Matter," IZA Discussion Papers 6312, Institute for the Study of Labor (IZA).
  8. repec:ese:iserwp:2011-21 is not listed on IDEAS
  9. Luciana Méndez Errico, 2013. "The Impacts of Social Networks on Immigrants’ Employment Prospects: The Spanish Case 1997-2007," Working Papers wpdea1301, Department of Applied Economics at Universitat Autonoma of Barcelona.
  10. Isabelle Chort, 2013. "Migrant network and immigrants’ occupational mismatch," Working Papers DT/2013/04, DIAL (Développement, Institutions et Mondialisation).

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