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A Social Network Analysis of Occupational Segregation

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Author Info
Marco J. van der Leij (University of Alicante)
I. Sebastian Buhai (University of Alicante)

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

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Find related papers by JEL classification:
J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
J70 - Labor and Demographic Economics - - Labor Discrimination - - - General
Z13 - Other Special Topics - - Cultural Economics - - - Social Norms and Social Capital; Social Networks Economic Anthropology

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  24. Altonji, Joseph G. & Blank, Rebecca M., 1999. "Race and gender in the labor market," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 48, pages 3143-3259 Elsevier. [Downloadable!] (restricted)
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  25. Datcher, Linda, 1983. "The Impact of Informal Networks of Quit Behavior," The Review of Economics and Statistics, MIT Press, vol. 65(3), pages 491-95, August. [Downloadable!] (restricted)
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(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Martin Kahanec, 2007. "Ethnic Competition and Specialization," IZA Discussion Papers 3167, Institute for the Study of Labor (IZA). [Downloadable!]
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