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Friends’ Networks and Job Finding Rates

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  • Lorenzo Cappellari

    ()
    (DISCE, Università Cattolica)

  • Konstantinos Tatsiramos

    ()
    (Institute for the Study of Labor Bonn)

Abstract

We investigate the effect of social interactions on labor market outcomes using a direct measure of social contacts based on information about individuals’ three best friends and their characteristics. We examine the effect of the number of employed friends on the transition from non-employment to employment, and we find the existence of significant network effects at the individual level. An additional employed friend increases the probability of finding a job by 3.7 percentage points. This finding is robust to specifications that address the endogeneity of friends’ employment status, which may be induced by correlation with unobserved individual attributes and feedback effects. Considering labor market outcomes, we find evidence of higher wages and employment stability for those with more employed friends, which is consistent with networks acting as an information transmission mechanism.

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File URL: http://www.unicatt.it/Istituti/EconomiaImpresaLavoro/Quaderni/ieil0059.pdf
File Function: First version, 2010
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Bibliographic Info

Paper provided by Università Cattolica del Sacro Cuore, Dipartimenti e Istituti di Scienze Economiche (DISCE) in its series DISCE - Quaderni dell'Istituto di Economia dell'Impresa e del Lavoro with number ieil0059.

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Length: 32
Date of creation: Oct 2010
Date of revision:
Handle: RePEc:ctc:serie4:ieil0059

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Web page: http://www.unicatt.it/Istituti/EconomiaImpresaLavoro
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Keywords: Networks; Unemployment; Friendship ties.;

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References

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Citations

Blog mentions

As found by EconAcademics.org, the blog aggregator for Economics research:
  1. A case for workfare
    by chris dillow in Stumbling and Mumbling on 2012-02-20 13:29:17
  2. "Social cleansing" and network effects
    by chris dillow in Stumbling and Mumbling on 2012-04-24 14:28:05
  3. "Social cleansing" and network effects
    by chris dillow in Stumbling and Mumbling on 2012-04-24 14:28:05
  4. Jobless danger for wages
    by chris dillow in Stumbling and Mumbling on 2013-02-21 11:43:00
Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
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Cited by:
  1. Stephan Humpert & Christian Pfeifer, 2011. "Explaining Age and Gender Differences in Employment Rates: A Labor Supply Side Perspective," Working Paper Series in Economics 214, University of Lüneburg, Institute of Economics.
  2. Nicoletta Balbo & Nicola Barban & Melinda Mills, 2013. "Friend and peer effects on entry into marriage and parenthood: A multiprocess approach," Working Papers 056, "Carlo F. Dondena" Centre for Research on Social Dynamics (DONDENA), Università Commerciale Luigi Bocconi.
  3. Nordström Skans, Oskar & Kramarz, Francis, 2011. "When strong ties are strong – networks and youth labor market entry," Working Paper Series 2011:18, IFAU - Institute for Evaluation of Labour Market and Education Policy.
  4. Albrecht Glitz, 2013. "Coworker Networks in the Labour Market," CESifo Working Paper Series 4250, CESifo Group Munich.
  5. Effrosyni Adamopoulou, 2012. "Peer Effects in Young Adults' Marital Decisions," Economics Working Papers we1228, Universidad Carlos III, Departamento de Economía.
  6. Effrosyni Adamopoulou & Ezgi Kaya, 2013. "Young adults living with their parents and the influence of peers," Economics Working Papers we1310, Universidad Carlos III, Departamento de Economía.
  7. repec:ese:iserwp:2013-24 is not listed on IDEAS
  8. 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.
  9. Anna Zaharieva, 2011. "Social Welfare and Wage Inequality in Search Equilibrium with Personal Contacts," Working Papers 459, Bielefeld University, Center for Mathematical Economics.

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