The Dynamics of Referral Hiring and Racial Inequality: Evidence from Brazil

Conrad Miller and Ian Schmutte

Institute for Research on Labor and Employment, Working Paper Series from Institute of Industrial Relations, UC Berkeley

Abstract: We study how referral hiring contributes to racial inequality in firm-level labor demand over the firm’s life cycle using data from Brazil. We consider a search model where referral networks are segregated, firms are more informed about the match quality of referred candidates, and some referrals are made by non-referred employees. Consistent with the model, we find that firms are more likely to hire candidates and less likely to dismiss employees of the same race as the founder, but these differences diminish as firms’ cumulative hires increase. Referral hiring helps to explain racial differences in dismissals, seniority, and employer size.

Keywords: Social and Behavioral Sciences; firms and organizations; inequality (search for similar items in EconPapers)
Date: 2021-09-17
New Economics Papers: this item is included in nep-bec, nep-dem and nep-hrm
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Citations: View citations in EconPapers (5)

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Related works:
Working Paper: The Dynamics of Referral Hiring and Racial Inequality: Evidence from Brazil (2021)
Working Paper: The Dynamics of Referral Hiring and Racial Inequality: Evidence from Brazil (2021)
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Persistent link: https://EconPapers.repec.org/RePEc:cdl:indrel:qt3kh1x11r

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