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Why the Referential Treatment? Evidence from Field Experiments on Referrals

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  • Amanda Pallais
  • Emily Glassberg Sands

Abstract

Referred workers are more likely than nonreferred workers to be hired, all else equal. In three field experiments in an online labor market, we examine why. We find that referrals contain positive information about worker performance and persistence that is not contained in workers' observable characteristics. We also find that referrals perform particularly well when working directly with their referrers. However, we do not find evidence that referrals exert more effort because they believe their performance will affect their relationship with their referrer or their referrer's position at the firm.

Suggested Citation

  • Amanda Pallais & Emily Glassberg Sands, 2016. "Why the Referential Treatment? Evidence from Field Experiments on Referrals," Journal of Political Economy, University of Chicago Press, vol. 124(6), pages 1793-1828.
  • Handle: RePEc:ucp:jpolec:doi:10.1086/688850
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    Citations

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    Cited by:

    1. Abebe, Girum & Caria, Stefano & Fafchamps, Marcel & Falco, Paolo & Franklin, Simon & Quinn, Simon & Shilpi, Forhad, 2017. "Matching firms and workers in a field experiment in Ethiopia," LSE Research Online Documents on Economics 86572, London School of Economics and Political Science, LSE Library.
    2. Martin Abel & Rulof Burger & Patrizio Piraino, 2017. "The value of reference letters," Working Papers 06/2017, Stellenbosch University, Department of Economics.
    3. repec:eee:labeco:v:50:y:2018:i:c:p:67-79 is not listed on IDEAS
    4. repec:iza:izawol:journl:2017:n:369 is not listed on IDEAS
    5. Yann Bramoull'e & Kenan Huremovi'c, 2017. "Promotion through Connections: Favors or Information?," Papers 1708.07723, arXiv.org.
    6. Beugnot, Julie & Peterlé, Emmanuel, 2018. "Gender Bias in Job Referrals: An Experimental Test," MPRA Paper 87538, University Library of Munich, Germany.

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