How helpful are social networks in finding a job along the economic cycle? Evidence from immigrants in FranceEva Moreno Galbis, François-Charles Wolff and Arnaud Herault Economic Modelling, 2020, vol. 91, issue C, 12-32 Abstract: Around 50% of individuals obtain or hear about jobs through social networks. This hiring trend may become problematic when the labor market is tight and people need less social contacts to find a job. Using a one-period static model where network members may receive job offers directly from the firm or indirectly through employed members in the network we show that the share of new hires finding a job through social connections (ie network matching rate) decreases with the job finding rate. Using French data for the period 2003–2012, we test this prediction with immigrants, a population subgroup for whom networks play a major role in occupational decisions. We propose two network matching rate indicators, one based on direct recommendations and another one internalizing the positive externality on the employment probability induced by peers. We find a decreasing relationship between the network matching rate and the job finding rate. Social connections are less helpful for finding jobs during economic expansions. Keywords: Immigrant; Network matching rate; Economic cycle (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:ecmode:v:91:y:2020:i:c:p:12-32 DOI: 10.1016/j.econmod.2020.05.017 Access Statistics for this article Economic Modelling is currently edited by S. Hall and P. Pauly More articles in Economic Modelling from Elsevier |
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