Dangerous liaisons: a social network model for the gender wage gap
AbstractWe combine stylized facts from social network literature with findings from the literature on the gender wage gap in a formal model. This model is based on employers’ use of social networks in the hiring process in order to assess employee productivity. As a result, there is a persistent gender wage gap, with women being underpaid relative to men after controlling for productivity characteristics. Networks exhibit inbreeding biases by productivity and by gender, which in combination with women’s lower network density cause women to be hired less often through referral, as well as receive a lower average referral wage premium. Finally, we use 2001-2006 UK Labour Force Survey data to test the hypotheses implied by our model. We find that networks do indeed account for a significant part of the gender wage gap for newly hired workers.
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Bibliographic InfoPaper provided by Katholieke Universiteit Leuven, Centrum voor Economische Studiën in its series Center for Economic Studies - Discussion papers with number ces0722.
Date of creation: Aug 2007
Date of revision:
social networks; gender wage gap; imperfect information;
Find related papers by JEL classification:
- J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination
- J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-03-25 (All new papers)
- NEP-LAB-2008-03-25 (Labour Economics)
- NEP-NET-2008-03-25 (Network Economics)
- NEP-SOC-2008-03-25 (Social Norms & Social Capital)
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- Michele Mosca & Francesco Pastore, 2009.
"Wage Effects of Recruitment Methods: The Case of the Italian Social Service Sector,"
AIEL Series in Labour Economics,
in: Marco Musella & Sergio Destefanis (ed.), Paid and Unpaid Labour in the Social Economy. An International Perspective, edition 1, chapter 8, pages 115-141
AIEL - Associazione Italiana Economisti del Lavoro.
- Mosca, Michele & Pastore, Francesco, 2008. "Wage Effects of Recruitment Methods: The Case of the Italian Social Service Sector," IZA Discussion Papers 3422, Institute for the Study of Labor (IZA).
- Hassink, Wolter & Russo, Giovanni, 2010. "The Glass Door: The Gender Composition of Newly-Hired Workers Across Hierarchical Job Levels," IZA Discussion Papers 4858, Institute for the Study of Labor (IZA).
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