| Author: | Montgomery, J. D. |
| Title: | Social networks and labor-market outcomes: toward an economic analysis |
| Journal: | American Economic Review
1991 : DEC, VOL. 81:5, p. 1408-1418 |
| Index terms: | ECONOMIC ANALYSIS LABOUR MARKETS SOCIAL STRUCTURE NETWORKS SELECTION OF PERSONNEL MANAGEMENT PERSONNEL |
| Language: | eng |
| Abstract: | Labour economists have long recognized that many workers find jobs through friends and relatives; personnel researchers argue that employee referrals are a useful device for screening job applicants. The importance of employee referrals in the hiring process is reviewed and alternative explanations for their use are discussed. A formal model of the hiring process is developed. It incorporates a simple social structure. Providing an equilibrium analysis of employee referrals, the model explains why workers who are well connected possessing social ties might fare better than those who are poorly connected and why firms hiring through referral might earn higher profits. |
SCIMA