This paper is a study of the function of appointments of referred workers as a way of motivating employees. Earlier research has stressed out that infromation about the ability of the referred applicant can explain why appointments through contacts are made. In this paper it is shown that it can be profitable to appoint new employees according to the suggestions of the old employees even though it means that the employer deliberately appoints applicants with lower ability.
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Publisher Info
Paper provided by Aarhus School of Business - Department of Economics in its series Papers with number
98-9.
Length: 18 pages Date of creation: 1998 Date of revision: Handle: RePEc:fth:aascbu:98-9
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