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Do Parental Networks Pay Off? Linking Children's Labor-Market Outcomes to their Parents' Friends

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  • Plug, Erik

    (University of Amsterdam)

  • van der Klaauw, Bas

    (Vrije Universiteit Amsterdam)

  • Ziegler, Lennart

    (University of Vienna)

Abstract

This paper examines whether children are better off if their parents have stronger social networks. Using data on high-school friendships of parents, we analyze whether the number and characteristics of friends affect the labor-market outcomes of children. While parental friendships formed in high school appear long lasting, we find no significant impact on their children's occupational choices and earnings prospects. These results do not change when we account for network endogeneity, network persistency and network measurement error. Only when children enter the labor market, we find that friends of parents have a marginally significant but small influence on the occupational choice of children.

Suggested Citation

  • Plug, Erik & van der Klaauw, Bas & Ziegler, Lennart, 2015. "Do Parental Networks Pay Off? Linking Children's Labor-Market Outcomes to their Parents' Friends," IZA Discussion Papers 9074, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp9074
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    Cited by:

    1. Ralf Werner Koßmann, 2016. "Effectiveness of Social Capital in the Job Search Process," SOEPpapers on Multidisciplinary Panel Data Research 823, DIW Berlin, The German Socio-Economic Panel (SOEP).
    2. Cobb-Clark, Deborah A. & Dahmann, Sarah C. & Gielen, Anne C., 2020. "The Intergenerational Effects of Requiring Unemployment Benefit Recipients to Engage in Non-Search Activities," IZA Discussion Papers 13618, Institute of Labor Economics (IZA).
    3. Grübl, Dominik & Lackner, Mario & Winter-Ebmer, Rudolf, 2020. "Intergenerational Transmission of Unemployment - Causal Evidence from Austria," IHS Working Paper Series 14, Institute for Advanced Studies.
    4. Aina, Carmen & Baici, Eliana & Casalone, Giorgia & Pastore, Francesco, 2018. "The economics of university dropouts and delayed graduation: a survey," GLO Discussion Paper Series 189, Global Labor Organization (GLO).
    5. Aina, Carmen & Baici, Eliana & Casalone, Giorgia & Pastore, Francesco, 2022. "The determinants of university dropout: A review of the socio-economic literature," Socio-Economic Planning Sciences, Elsevier, vol. 79(C).
    6. Damdinsuren, Erdenebulgan & Mitkova, Mariya & Zaharieva, Anna, 2024. "Parental networks, wage expectations, and the intergenerational educational mobility," Journal of Economic Behavior & Organization, Elsevier, vol. 218(C), pages 146-175.
    7. Andrea Morescalchi, 2021. "A new career in a new town. Job search methods and regional mobility of unemployed workers," Portuguese Economic Journal, Springer;Instituto Superior de Economia e Gestao, vol. 20(2), pages 223-272, May.
    8. Bastani, Spencer & Karlsson, Kristina & Kolsrud, Jonas & Waldenström, Daniel, 2024. "The Capital Advantage: Comparing Returns to Ability in the Labor and Capital Markets," Working Papers in Economics and Statistics 1/2024, Linnaeus University, School of Business and Economics, Department of Economics and Statistics.
    9. Bastani, Spencer & Karlsson, Kristina & Waldenström, Daniel, 2023. "The Different Returns to Cognitive Ability in the Labor and Capital Markets," Working Paper Series 1459, Research Institute of Industrial Economics.
    10. Marco Bertoni & Giorgio Brunello & Lorenzo Cappellari, 2020. "Who benefits from privileged peers? Evidence from siblings in schools," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 35(7), pages 893-916, November.
    11. Obbey Ahmed Elamin, 2018. "Impact of Informal Job-search on Wages for University Graduates in Egypt and Jordan," Working Papers 1272, Economic Research Forum, revised 19 Dec 2018.
    12. Li, Chunxiao & Gilleskie, Donna B., 2021. "The influence of endogenous behaviors among social pairs: Social interaction effects of smoking," Journal of Health Economics, Elsevier, vol. 80(C).
    13. Omoniyi B. Alimi & David C. Maré & Jacques Poot, 2022. "Who partners up? Homogamy and income inequality in New Zealand cities," Journal of Regional Science, Wiley Blackwell, vol. 62(1), pages 171-193, January.
    14. Bastani, Spencer & Karlsson, Kristina & Waldenström, Daniel, 2023. "The different returns to cognitive ability in the labor and capital markets," Working Paper Series 2023:8, IFAU - Institute for Evaluation of Labour Market and Education Policy.

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    More about this item

    Keywords

    occupational choice; informal job search; intergenerational effects; social networks;
    All these keywords.

    JEL classification:

    • A14 - General Economics and Teaching - - General Economics - - - Sociology of Economics
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J46 - Labor and Demographic Economics - - Particular Labor Markets - - - Informal Labor Market
    • J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion

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