The literature on social networks in labor markets often assumes that hiring through a network is a token in a reciprocal favor exchange. Yet, the scope and mechanisms of this phenomenon remain unclear. I propose a general theoretical framework that initially takes the stand-alone favor, rather...

Although the existing theory predicts that a referral’s chances of being hired increase with the job performance of the referrer, no empirical evidence is available to support this claim. To address this discrepancy, we decompose the recruitment process into objective selection, subjective...