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A Social Network Analysis of Occupational Segregation

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  • Marco J. van der Leij

    (University of Alicante)

  • I. Sebastian Buhai

    (University of Alicante)

Abstract

We develop a social network model of occupational segregation between different social groups, generated by the existence of positive inbreeding bias among individuals from the same group. If network referrals are important for job search, then expected homophily in the contact network structure induces different career choices for individuals from different social groups. This further translates into stable occupational segregation equilibria in the labor market. We derive the conditions for wage and unemployment inequality in the segregation equilibria and characterize first and second best social welfare optima. Surprisingly, we find that socially optimal policies involve segregation.

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Bibliographic Info

Paper provided by Fondazione Eni Enrico Mattei in its series Working Papers with number 2008.31.

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Date of creation: Mar 2008
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Handle: RePEc:fem:femwpa:2008.31

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Keywords: Social Networks; Homophily; Inbreeding Bias; Occupational Segregation; Labor Market Inequality; Social Welfare;

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References

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Citations

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Cited by:
  1. Ott Toomet & Marco van der Leij & Meredith Rolfe, 2012. "Social Networks and Labor Market Inequality between Ethnicities and Races," Tinbergen Institute Discussion Papers 12-120/II, Tinbergen Institute.
  2. Kahanec, Martin, 2007. "Ethnic Competition and Specialization," IZA Discussion Papers 3167, Institute for the Study of Labor (IZA).
  3. Crespo, Nuno & Simoes, Nadia & Moreira, Sandrina B., 2013. "Gender Differences in Occupational Mobility – Evidence from Portugal," MPRA Paper 49195, University Library of Munich, Germany.
  4. Pothier, David, 2012. "Referral networks and the allocation of talent," MPRA Paper 39895, University Library of Munich, Germany.
  5. POTHIER, David, 2012. "Referral Networks and the Allocation of Talent," Economics Working Papers ECO2012/18, European University Institute.
  6. Sergio Currarini & Fernando Vega Redondo, 2010. "Search and Homophily in Social Networks," Working Papers 2010_24, Department of Economics, University of Venice "Ca' Foscari".
  7. De Martí, Joan & Zenou, Yves, 2009. "Ethnic Identity and Social Distance in Friendship Formation," CEPR Discussion Papers 7566, C.E.P.R. Discussion Papers.

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