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Intergenerational Networks, Unemployment, and Persistent Inequality in South Africa

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  • Jeremy R. Magruder

Abstract

This paper examines the importance of network-based intergenerational correlations in South Africa. I use longitudinal data on young South Africans to examine the covariance of children's employment with the usefulness of parents in their job search. I find that fathers serve as useful network connections to their sons (not daughters), and that mothers do not seem to be useful network connections. The father-son effect is robust to alternate explanations of specific human capital and correlated networks. The size of this effect is large. Present fathers' utility as network connections may be responsible for a one-third increase in their sons' employment rates. (JEL D31, J12, J13, J24, J62, O15, Z13)

Suggested Citation

  • Jeremy R. Magruder, 2010. "Intergenerational Networks, Unemployment, and Persistent Inequality in South Africa," American Economic Journal: Applied Economics, American Economic Association, vol. 2(1), pages 62-85, January.
  • Handle: RePEc:aea:aejapp:v:2:y:2010:i:1:p:62-85
    Note: DOI: 10.1257/app.2.1.62
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Todd Pugatch, 2014. "Safety valve or sinkhole? Vocational schooling in South Africa," IZA Journal of Labor & Development, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 3(1), pages 1-31, December.
    2. Nicoletta Berardi, 2013. "Social networks and wages in Senegal’s labor market," IZA Journal of Labor & Development, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 2(1), pages 1-26, December.
    3. Carmen Aina & Cheti Nicoletti, 2014. "The intergenerational transmission of liberal professions: nepotism versus abilities," Discussion Papers 14/14, Department of Economics, University of York.
    4. Jacopo Bonan & Pietro Battiston & Jaimie Bleck & Philippe LeMay-Boucher & Stefano Pareglio & Bassirou Sarr & Massimo Tavoni, 2017. "Social Interaction and Technology Adoption: Experimental Evidence from Improved Cookstoves in Mali," Working Papers 2017.47, Fondazione Eni Enrico Mattei.
    5. Jonas Hjort & Jonas Poulsen, 2017. "The Arrival of Fast Internet and Employment in Africa," NBER Working Papers 23582, National Bureau of Economic Research, Inc.
    6. Nordman, Christophe J. & Pasquier-Doumer, Laure, 2015. "Transitions in a West African labour market: The role of family networks," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 54(C), pages 74-85.
    7. Kaivan Munshi, 2014. "Community Networks and the Process of Development," Journal of Economic Perspectives, American Economic Association, vol. 28(4), pages 49-76, Fall.
    8. M. Savioli & R. Patuelli, 2016. "Social capital, institutions and policymaking," Working Papers wp1070, Dipartimento Scienze Economiche, Universita' di Bologna.
    9. Ariel BenYishay & A. Mushfiq Mobarak, 2014. "Social Learning and Communication," NBER Working Papers 20139, National Bureau of Economic Research, Inc.
    10. Martin Abel & Rulof Burger & Patrizio Piraino, 2017. "The value of reference letters," Working Papers 06/2017, Stellenbosch University, Department of Economics.
    11. Whitaker, Stephan, 2016. "Industrial Composition and Intergenerational Mobility," Working Paper 1533, Federal Reserve Bank of Cleveland.
    12. Miquel Pellicer & Vimal Ranchhod & Mare Sarr & Eva Wegner, 2011. "Inequality Traps in South Africa: An overview and research agenda," SALDRU Working Papers 57, Southern Africa Labour and Development Research Unit, University of Cape Town.
    13. Abebe, Girum & Caria, Stefano & Fafchamps, Marcel & Falco, Paolo & Franklin, Simon & Quinn, Simon, 2017. "Anonymity of distance? Job search and labour market exclusion in a growing African city," LSE Research Online Documents on Economics 86573, London School of Economics and Political Science, LSE Library.
    14. Andrews, Matthew, 2008. "Is Black Economic Empowerment a South African Growth Catalyst? (Or Could It Be...)," Working Paper Series rwp08-033, Harvard University, John F. Kennedy School of Government.
    15. Miles Corak & Patrizio Piraino, 2011. "The Intergenerational Transmission of Employers," Journal of Labor Economics, University of Chicago Press, vol. 29(1), pages 37-68, January.
    16. Girum Abebe & Stefano Caria & Marcel Fafchamps & Paolo Falco & Simon Franklin & Simon Quinn, 2016. "Curse of Anonymity or Tyranny of Distance? The Impacts of Job-Search Support in Urban Ethiopia," NBER Working Papers 22409, National Bureau of Economic Research, Inc.
    17. Adelman, Sarah, 2013. "Keep your friends close: The effect of local social networks on child human capital outcomes," Journal of Development Economics, Elsevier, vol. 103(C), pages 284-298.
    18. repec:eee:labeco:v:51:y:2018:i:c:p:108-120 is not listed on IDEAS
    19. Ariel BenYishay & A. Mushfiq Mobarak, 2013. "Communicating with Farmers through Social Networks," Working Papers 1030, Economic Growth Center, Yale University.
    20. de Brauw, Alan & Mueller, Valerie & Lee, Hak Lim, 2014. "The Role of Rural–Urban Migration in the Structural Transformation of Sub-Saharan Africa," World Development, Elsevier, vol. 63(C), pages 33-42.
    21. Aina, Carmen & Nicoletti, Cheti, 2014. "The intergenerational mobility of liberal professions: nepotism versus abilities," ISER Working Paper Series 2014-39, Institute for Social and Economic Research.
    22. Caria, Antonia Stefano & Hassen, Ibrahim Worku, 2013. "The formation of job referral networks: Experimental evidence from ubran Ethiopia:," IFPRI discussion papers 1282, International Food Policy Research Institute (IFPRI).
    23. Florence Kondylis & Valerie Mueller, 2014. "Economic consequences of conflict and environmental displacement," Chapters,in: International Handbook on Migration and Economic Development, chapter 14, pages 388-424 Edward Elgar Publishing.
    24. Ronelle Burger & Marisa Coetzee & Carina van der Watt, 2013. "Estimating the benefits of linking ties in a deeply divided society: considering the relationship between domestic workers and their employers in South Africa," Working Papers 18/2013, Stellenbosch University, Department of Economics.
    25. Deguilhem, Thibaud & Berrou, Jean-Philippe & Combarnous, François, 2017. "Using your ties to get a worse job? The differential effects of social networks on quality of employment: Evidence from Colombia," MPRA Paper 78628, University Library of Munich, Germany.

    More about this item

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • J12 - Labor and Demographic Economics - - Demographic Economics - - - Marriage; Marital Dissolution; Family Structure
    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
    • Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification

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