Scandinavian Working Papers in Economics
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Department of Economics, Aarhus School of Business, University of Aarhus Working Papers, Department of Economics, Aarhus School of Business, University of Aarhus

No 06-11:
A Social Network Analysis of Occupational Segregation

Sebastian Buhai () and Marco van der Leij

Abstract: We develop a social network model of occupational segregation between

different social groups, generated by the existence of positive inbreeding

bias among individuals from the same group. If network referrals

are important in getting a job, then expected inbreeding bias in the

contact network structure induces different career choices for individuals

from different social groups. This further translates into stable occupational

segregation equilibria in the labour market. We derive the conditions

for persistent wage and unemployment inequality in the segregation

equilibria. Our framework is proposed as complementary to existing theories

used to explain labour market inequalities between groups divided

by race, ethnicity or gender

Keywords: Social Networks; Inbreeding Bias; Occupational Segregation; Labour Market Inequality; (follow links to similar papers)

JEL-Codes: A14; J31; Z13; (follow links to similar papers)

33 pages, November 7, 2006

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