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Do labor market networks have an important spatial dimension?

  • Judith K. Hellerstein

    ()

    (University of Maryland & NBER)

  • Mark J. Kutzbach

    ()

    (U.S. Bureau of the Census)

  • David Neumark

    ()

    (UCI, NBER & IZA)

We test for evidence of spatial, residence-based labor market networks. Turnover is lower for workers more connected to their neighbors generally and more connected to neighbors of the same race or ethnic group. Both results are consistent with networks producing better job matches, while the latter could also reflect preferences for working with neighbors of the same race or ethnicity. For earnings, we find a robust positive effect of the overall residence-based network measure, whereas we usually find a negative effect of the same-group measure, suggesting that the overall network measure reflects productivity-enhancing positive network effects, while the same-group measure may capture a non-wage amenity.

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Paper provided by Institut d'Economia de Barcelona (IEB) in its series Working Papers with number 2013/20.

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Length: 56 pages
Date of creation: 2013
Date of revision:
Handle: RePEc:ieb:wpaper:2013/6/doc2013-20
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  2. Brown, Meta & Setren, Elizabeth & Topa, Giorgio, 2014. "Do Informal Referrals Lead to Better Matches? Evidence from a Firm's Employee Referral System," IZA Discussion Papers 8175, Institute for the Study of Labor (IZA).
  3. Anna Piil Damm, 2012. "Neighborhood quality and labor market outcomes: evidence from quasi-random neighborhood assignment of immigrants," Working Papers 2012/22, Institut d'Economia de Barcelona (IEB).
  4. Judith Hellerstein & David Neumark, 2007. "Workplace Segregation in the United States: Race, Ethnicity, and Skill," Working Papers 07-02, Center for Economic Studies, U.S. Census Bureau.
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  6. Giorgio Topa & Stephen Ross & Patrick Bayer, 2005. "Place of Work and Place of Residence: Informal Hiring Networks and Labor Market Outcomes," Working Papers 05-23, Center for Economic Studies, U.S. Census Bureau.
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  11. Judith Hellerstein & Melissa McInerney & David Neumark, 2009. "Neighbors and Co-Workers: The Importance of Residential Labor Market Networks," Working Papers 09-01, Center for Economic Studies, U.S. Census Bureau.
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  16. Datcher, Linda, 1983. "The Impact of Informal Networks of Quit Behavior," The Review of Economics and Statistics, MIT Press, vol. 65(3), pages 491-95, August.
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  18. Olof Aslund & Lena Hensvik & Oskar Nordstrom Skans, 2009. "Seeking similarity: How immigrants and natives manage at the labor market," CReAM Discussion Paper Series 0932, Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London.
  19. Simon, Curtis J & Warner, John T, 1992. "Matchmaker, Matchmaker: The Effect of Old Boy Networks on Job Match Quality, Earnings, and Tenure," Journal of Labor Economics, University of Chicago Press, vol. 10(3), pages 306-30, July.
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  21. Judith K. Hellerstein & David Neumark, 2011. "Employment in Black Urban Labor Markets: Problems and Solutions," NBER Working Papers 16986, National Bureau of Economic Research, Inc.
  22. Lang, Kevin, 1986. "A Language Theory of Discrimination," The Quarterly Journal of Economics, MIT Press, vol. 101(2), pages 363-82, May.
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