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This paper studies how social structure — the pattern of social links that connect individuals in a community — affects labor markets. Under competing views on the role of networks, social structures that discourage network hiring could improve or hinder labor market performance. We test these competing views using data on marriage networks in 15,000 villages, combined with labor force survey data. Using regressions analyses and an instrumental variable strategy, we find that individuals living in more socially fragmented villages are less likely to work in family firms, more likely to use formal job search strategies, invest more in education and earn higher wages. Social fragmentation thus discourages network hiring and improves labor market performance. These results survive 384 combinations of robustness checks. We further provide direct evidence against reverse causality. [ABSTRACT FROM AUTHOR]

Over the past 40 years, college graduates in the USA have become increasingly concentrated in a small number of cities. This paper uses qualitative interviews to explore the processes bringing recent graduates of elite universities to one such city, metropolitan Boston, after graduation. Most respondents reported that their move to Boston was not driven by a clear preference for living there. Rather, they saw themselves as simultaneously choosing a job and a location in one bundled decision, with the job generally determining where they ended up. To reduce the cognitive complexity of the joint job-and-location search, graduates eliminated most options with minimal consideration. The options that remained were disproportionately in cities where the graduates or their universities had preexisting connections—even when the graduates themselves would have preferred to live elsewhere. The social nature of the post-college job search thus served to geographically concentrate these graduates beyond what either their own preferences or the geography of job opportunities would require. [ABSTRACT FROM AUTHOR]