ICES 5 th Annual Conference on Behavioral and Experimental Economics

s: An Endogenous Job Contact Network in the Laboratory David Powers ICES, Economics Department, George Mason University ABSTRACT: Jobs are commonly found through social contacts, and certain labor market conditions, such as the job turnover rate and rate of job creation, may have measurable impact for social networking choice. This work provides a laboratory test of Galeotti and Merlino “Endogenous Job Contact Network” model (IER 2014), a theory which predicts a nonmonotonic increasing and then decreasing relation between the job separation rate and both the level of network investment and networking job matching rate. Results are presented for both a direct lab implementation of the theory as well as for a highlyincentivized version in which workers earn much higher wages if the job is found through the network versus if the job is received exogenously. Results are also disaggregated and tested by the extent of information given, by the extent of experience of the subjects, and by summary characteristics of the subjects. Related extensions for suggested future work are also discussed. Authors: David Powers and Daniel Houser Jobs are commonly found through social contacts, and certain labor market conditions, such as the job turnover rate and rate of job creation, may have measurable impact for social networking choice. This work provides a laboratory test of Galeotti and Merlino “Endogenous Job Contact Network” model (IER 2014), a theory which predicts a nonmonotonic increasing and then decreasing relation between the job separation rate and both the level of network investment and networking job matching rate. Results are presented for both a direct lab implementation of the theory as well as for a highlyincentivized version in which workers earn much higher wages if the job is found through the network versus if the job is received exogenously. Results are also disaggregated and tested by the extent of information given, by the extent of experience of the subjects, and by summary characteristics of the subjects. Related extensions for suggested future work are also discussed. Authors: David Powers and Daniel Houser