FORMAL SEARCH AND REFERRALS FROM A FIRM'S PERSPECTIVE | Zendy

Rebien Martina | Zendy; Stops Michael | Zendy; Zaharieva Anna | Zendy

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FORMAL SEARCH AND REFERRALS FROM A FIRM'S PERSPECTIVE

Author(s) -

Rebien Martina,

Stops Michael,

Zaharieva Anna

Publication year - 2020

Publication title -

international economic review

Language(s) - English

Resource type - Journals

SCImago Journal Rank - 2.658

H-Index - 86

eISSN - 1468-2354

pISSN - 0020-6598

DOI - 10.1111/iere.12477

Subject(s) - perspective (graphical) , channel (broadcasting) , business , search cost , marketing , microeconomics , industrial organization , economics , computer science , artificial intelligence , computer network

We explore the relationship between firms' characteristics and recruitment strategies. We present a theoretical search model with two search channels: a costly formal channel and a costless informal channel (referrals). We empirically test the model predictions and find that: larger firms search more formally; firms search more formally for high‐skilled workers; the positive relationship between firm's size and formal search intensity also holds for firms not using referrals; firms using referrals invest less into formal search compared to firms not using referrals; larger firms hire less often by referrals than smaller firms; and larger search effort leads to more applicants.

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