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Social Networks and Labor Market Transitions

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Author Info

  • Bramoullé,Yann

    (LEERNA, Université Toulouse I)

  • Saint-Paul, Gilles

    () (IDEI, GREMAQ, LEERNA, Université Toulouse I, CEPR and IZA Bonn)

Abstract

We study the influence of social networks on labor market transitions. We develop the first model where social ties and job status coevolve through time. Our key assumption is that the probability of formation of a new tie is greater between two employed individuals than between an employed and an unemployed individual. We show that this assumption generates negative duration dependence of exit rates from unemployment. Our model has a number of novel testable implications. For instance, we show that a higher connectivity among unemployed individuals reduces duration dependence and that exit rates depend positively on the duration of the last job held by the unemployed worker.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 1215.

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Length: 38 pages
Date of creation: Jul 2004
Date of revision:
Handle: RePEc:iza:izadps:dp1215

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Related research

Keywords: social networks; unemployment duration; labor market transitions; social capital; economic inbreeding;

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  1. Duncan Smith's daft idea
    by chris dillow in Stumbling and Mumbling on 2010-06-27 11:17:48
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Cited by:
  1. Cingano, Federico & Rosolia, Alfonso, 2008. "People I Know: Job Search and Social Networks," CEPR Discussion Papers 6818, C.E.P.R. Discussion Papers.
  2. Simon Gemkow & Michael Neugart, 2011. "Referral hiring, endogenous social networks, and inequality: an agent-based analysis," Journal of Evolutionary Economics, Springer, vol. 21(4), pages 703-719, October.
  3. Marco J. van der Leij & I. Sebastian Buhai, 2008. "A Social Network Analysis of Occupational Segregation," Working Papers 2008.31, Fondazione Eni Enrico Mattei.
  4. Federico Cingano & Alfonso Rosolia, 2006. "People I Know: Workplace Networks and Job Search Outcomes," Temi di discussione (Economic working papers) 600, Bank of Italy, Economic Research and International Relations Area.

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