Referral and Job Performance: Evidence from the Ghana Colonial Army

Marcel Fafchamps and Alexander Moradi

No 7408, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: As formalized by Montgomery (1991), referral by employees improves efficiency if the unobserved quality of a new worker is higher than that of unrefereed workers. Using data compiled from army archives, we test whether the referral system in use in the British colonial army in Ghana served to improve the unobserved quality of new recruits. We find that it did not: referred recruits were more likely than unreferred recruits to desert or be dismissed as 'inefficient' or 'unfit'. We find instead evidence of referee opportunism. The fact that referred recruits have better observed characteristics at the time of recruitment suggests that army recruiters may have been aware of this problem.

Keywords: Employee referral; Worker productivity; Hidden attributes (search for similar items in EconPapers)
JEL-codes: J63 N47 O15 (search for similar items in EconPapers)
Date: 2009-08
New Economics Papers: this item is included in nep-afr, nep-dev, nep-his and nep-lab
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

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Related works:
Journal Article: Referral and Job Performance: Evidence from the Ghana Colonial Army (2015)
Working Paper: Referral and Job Performance: Evidence from the Ghana Colonial Army (2009)
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