Who Gets the Job? The Consequences of Strategic Information Sharing within Social Networks
We study how job-seekers share information about jobs within their social network, and its implications for the quality of applicants and hires. We randomly increase the amount of competition for a job that we created and find that jobseekers are less likely to share information about the job, especially with their high ability peers. This lowers the quality of applicants, hires, and performance on the job — suggesting that disseminating job information through social networks may result in lower quality applicants than expected for competitive positions. While randomly offering higher wages attracts better talent, it is not able to fully overcome these strategic disincentives.
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