Do Informal Referrals Lead to Better Matches? Evidence from a Firm's Employee Referral System

Meta Brown, Elizabeth Setren and Giorgio Topa

Journal of Labor Economics, 2016, vol. 34, issue 1, 161 - 209

Abstract: Using a new firm-level data set that includes explicit information on referrals by current employees, we investigate the hiring process and the relationships among referrals, match quality, wage trajectories, and turnover for a single US corporation and test various predictions of theoretical models of labor market referrals. We find that referred candidates are more likely to be hired; experience an initial wage advantage, which dissipates over time; and have longer tenure in the firm. Further, the variances of the referred and nonreferred wage distributions converge over time. The observed referral effects appear to be stronger at lower skill levels. The data also permit analysis of the role of referrer-referee pair characteristics.

Date: 2016
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (82)

Downloads: (external link)
http://dx.doi.org/10.1086/682338 (application/pdf)
http://dx.doi.org/10.1086/682338 (text/html)
Access to the online full text or PDF requires a subscription.

Related works:
Working Paper: Do Informal Referrals Lead to Better Matches? Evidence from a Firm's Employee Referral System (2014)
Working Paper: Do informal referrals lead to better matches? Evidence from a firm's employee referral system (2012)
Working Paper: Do Informal Referrals Lead to Better Matches? Evidence from a FirmÂ’'s Employee Referral System (2012)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ucp:jlabec:doi:10.1086/682338

Access Statistics for this article

More articles in Journal of Labor Economics from University of Chicago Press
Bibliographic data for series maintained by Journals Division ().