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Choosing the Right Pond: Social Approval and Occupational Choice


  • Anandi Mani

    (Williams College)

  • Charles H. Mullin

    (Bates White)


We model the endogenous emergence of social perceptions about occupations and their impact on occupational choice. In particular, an individual's social approval increases with his community's perception of his skill in his chosen career. These perceptions vary across communities because individuals better assess the skill of those in occupations similar to their own. Such imperfect assessment can distort choices away from comparative advantage. When skill distributions differ across occupations and/or correlate positively, the community perceives one occupation more favorably. This favored sector experiences overcrowding, but misallocation occurs across both sectors. Furthermore, a positive skill correlation can produce multiple steady states.

Suggested Citation

  • Anandi Mani & Charles H. Mullin, 2004. "Choosing the Right Pond: Social Approval and Occupational Choice," Journal of Labor Economics, University of Chicago Press, vol. 22(4), pages 835-862, October.
  • Handle: RePEc:ucp:jlabec:v:22:y:2004:i:4:p:835-862

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    References listed on IDEAS

    1. George A. Akerlof, 1997. "Social Distance and Social Decisions," Econometrica, Econometric Society, vol. 65(5), pages 1005-1028, September.
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    5. Oded Galor & Joseph Zeira, 1993. "Income Distribution and Macroeconomics," Review of Economic Studies, Oxford University Press, vol. 60(1), pages 35-52.
    6. Bernheim, B Douglas, 1994. "A Theory of Conformity," Journal of Political Economy, University of Chicago Press, vol. 102(5), pages 841-877, October.
    7. Borjas, George J, 1995. "Ethnicity, Neighborhoods, and Human-Capital Externalities," American Economic Review, American Economic Association, vol. 85(3), pages 365-390, June.
    8. Boyan Jovanovic, 1982. "Favorable Selection with Asymmetric Information," The Quarterly Journal of Economics, Oxford University Press, vol. 97(3), pages 535-539.
    9. Bisin, Alberto & Verdier, Thierry, 1998. "On the cultural transmission of preferences for social status," Journal of Public Economics, Elsevier, vol. 70(1), pages 75-97, October.
    10. A. D. Roy, 1951. "Some Thoughts On The Distribution Of Earnings," Oxford Economic Papers, Oxford University Press, vol. 3(2), pages 135-146.
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    Cited by:

    1. Holger Strulik, 2012. "Riding High: Success in Sports and the Rise of Doping Cultures," Scandinavian Journal of Economics, Wiley Blackwell, vol. 114(2), pages 539-574, June.
    2. Holger Strulik, 2013. "School Attendance And Child Labor—A Model Of Collective Behavior," Journal of the European Economic Association, European Economic Association, vol. 11(2), pages 246-277, April.
    3. Tacsir, Ezequiel, 2010. "Occupation Choice: Family, Social and Market Influences," MERIT Working Papers 013, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    4. Strulik, Holger, 2014. "A mass phenomenon: The social evolution of obesity," Journal of Health Economics, Elsevier, vol. 33(C), pages 113-125.
    5. Julie L. Hotchkiss & Anil Rupasingha, 2016. "Wage Determination in Social Occupations: the Role of Individual Social Capital," Working Papers 16-46, Center for Economic Studies, U.S. Census Bureau.
    6. Tacsir, Ezequiel, 2009. "Elección de ocupación: factores personales y aspectos sociales
      [Occupation Choice: Personal factors and Social Aspects]
      ," MPRA Paper 20432, University Library of Munich, Germany.
    7. Stocké, Volker, 2008. "Educational decisions as rational choice? : an empirical test of the Erikson-Jonsson model for explaining educational attainment," Papers 08-03, Sonderforschungsbreich 504.
    8. Strulik, Holger, 2008. "The Role of Poverty and Community Norms in Child Labor and Schooling Decisions," Proceedings of the German Development Economics Conference, Zurich 2008 42, Verein für Socialpolitik, Research Committee Development Economics.

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