Tipping Points: Referral Homophily and Job Segregation

51 Pages Posted: 21 Jun 2010

See all articles by Brian Rubineau

Brian Rubineau

Cornell University

Roberto M. Fernandez

Massachusetts Institute of Technology (MIT) - Sloan School of Management

Date Written: June 21, 2010

Abstract

How does referral recruitment contribute to job segregation? Current theory emphasizes the segregated nature of job-seekers’ information and contact networks. The job-seeker perspective characterizing most research on network effects in the labor market leaves little role for organizational influence. But referrals are necessarily initiated within a firm by referrers. This paper focuses on the neglected half of the referring dyad and seeks to explain the segregating effects of referring from the referrer’s perspective. Our main finding is that if a firm can get its under-represented group to refer more, referral recruitment can be made neutral to job segregation, or even integrative. Our analysis reveals a tipping point in referring dynamics – precisely how much more the under-represented group needs to refer to neutralize the segregating effects of referring. We build upon previous research to generate a formal model of referring dynamics as a regular Markov population process. We use this model to build theory regarding the segregating effects of referring, and the role of organizations in this process. In so doing, we show the prevailing wisdom fails to explain how referring contributes to job segregation. We reveal the conditions necessary for referring to segregate and identify policy levers for firms to mitigate this effect.

Keywords: Job Segregation, Referral Homophily, Labor Market

Suggested Citation

Rubineau, Brian and Fernandez, Roberto M., Tipping Points: Referral Homophily and Job Segregation (June 21, 2010). MIT Sloan Research Paper No. 4783-10, Available at SSRN: https://ssrn.com/abstract=1628139 or http://dx.doi.org/10.2139/ssrn.1628139

Brian Rubineau

Cornell University ( email )

Ithaca, NY 14853
United States
607-255-3048 (Phone)

Roberto M. Fernandez (Contact Author)

Massachusetts Institute of Technology (MIT) - Sloan School of Management ( email )

100 Main Street
E62-416
Cambridge, MA 02142
United States

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