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Do Job Seekers Benefit from Contacts? A Direct Test with Contemporaneous Searches

Author

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  • Elena Obukhova

    (MIT Sloan School of Management, Massachusetts Institute of Technology, Cambridge, Massachusetts 02142)

  • George Lan

    (MIT Sloan School of Management, Massachusetts Institute of Technology, Cambridge, Massachusetts 02142,)

Abstract

Although it is intuitively plausible that a job seeker benefits by using contacts in her job search, the literature is plagued by theoretical disagreements and inconclusive empirical evidence. Single-firm studies consistently find that job seekers applying through referrals achieve better labor-market outcomes than job seekers applying without referrals, but the evidence from job-seeker studies is mixed. To solve this puzzle, we clarify the distinction between having social capital and using contacts as a search method. We present theoretical reasons to suggest that the lack of an association between a job seeker's social capital and whether or not she uses social networks to search for a job should not be taken to imply that job seekers who use social networks to search for jobs do not benefit from using contacts. We exploit a strategic research setting, the school-to-work transition of 291 university graduates who engaged in 3,112 contemporaneous job searches, to show that although a job seeker's social capital may not affect whether or not she uses contacts to search for a job, using contacts as a job-search method does improve her job-search outcomes. We conclude by discussing the implications of our findings for the literature on job search and social networks. This paper was accepted by Jesper Sørensen, organizations.

Suggested Citation

  • Elena Obukhova & George Lan, 2013. "Do Job Seekers Benefit from Contacts? A Direct Test with Contemporaneous Searches," Management Science, INFORMS, vol. 59(10), pages 2204-2216, October.
  • Handle: RePEc:inm:ormnsc:v:59:y:2013:i:10:p:2204-2216
    DOI: 10.1287/mnsc.1120.1701
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    References listed on IDEAS

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    Cited by:

    1. Roxana Barbulescu, 2015. "The Strength of Many Kinds of Ties: Unpacking the Role of Social Contacts Across Stages of the Job Search Process," Organization Science, INFORMS, vol. 26(4), pages 1040-1058, August.
    2. Rajiv Garg & Rahul Telang, 2018. "To Be or Not to Be Linked: Online Social Networks and Job Search by Unemployed Workforce," Management Science, INFORMS, vol. 64(8), pages 3926-3941, August.
    3. Asali, Muhammad, 2015. "Compulsory Military Service and Future Earnings: Evidence from a Quasi-Experiment," IZA Discussion Papers 8892, Institute of Labor Economics (IZA).
    4. Hana STOJANOVÁ & Pavel TOMŠÍK, 2014. "Factors influencing employment for tertiary education graduates at the selected universities," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 60(8), pages 376-387.
    5. Steven Crawford & Wesley Gray & Bryan R. Johnson & Richard A. Price, 2018. "What Motivates Buy-Side Analysts to Share Recommendations Online?," Management Science, INFORMS, vol. 64(6), pages 2574-2589, June.
    6. Matthieu Manant & Serge Pajak & Nicolas Soulié, 2019. "Can social media lead to labor market discrimination? Evidence from a field experiment," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 28(2), pages 225-246, April.
    7. Holger Lüdeke & Hanjo Allinger, 2017. "Zeig mir deine Freunde und ich sag dir, wer du bist – Ein empirischer Test zur Berücksichtigung der Akteursheterogenität in der Sozialkapitalforschung [Known by the company you keep – an empirical ," Schmalenbach Journal of Business Research, Springer, vol. 69(1), pages 1-40, March.
    8. Carolina Aragao & Aida Villanueva, 2021. "How do mothers work? Kin coresidence and mothers' work in Latin America," Demographic Research, Max Planck Institute for Demographic Research, Rostock, Germany, vol. 45(30), pages 917-956.
    9. Chua, Vincent, 2021. "Economic sociology in Singapore: Meritocracy and the missing embeddedness," economic sociology. perspectives and conversations, Max Planck Institute for the Study of Societies, vol. 23(1), pages 19-22.
    10. Son-Tung Le, 2022. "Networking Behavior as a Mediation in University Graduates’ HEXACO Personality Effects on Job Search Outcomes," SAGE Open, , vol. 12(2), pages 21582440221, April.
    11. Sidonia von Proff, 2015. "How individual characteristics and attitudes shape the job search process of graduates," Working Papers on Innovation and Space 2015-02, Philipps University Marburg, Department of Geography.
    12. Michael Weiler & Oliver Hinz, 2019. "Without each other, we have nothing: a state-of-the-art analysis on how to operationalize social capital," Review of Managerial Science, Springer, vol. 13(5), pages 1003-1035, November.
    13. Dariel, Aurelie & Riedl, Arno & Siegenthaler, Simon, 2021. "Referral hiring and wage formation in a market with adverse selection," Games and Economic Behavior, Elsevier, vol. 130(C), pages 109-130.

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