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Is Unemployment a Consequence of Social Interactions? Seeking for a Common Research Framework for Economists and other Social Scientists

16.04.2008 | HWWI Research Paper | von Andreia Tolciu

This article aims to summarize the existing body of literature on social interactions and their effect on individual unemployment status. Two directions of the ongoing research are analyzed: the impact of social norms on unemployment and the importance of social networks in the job search process. Pointing out that the difficulties encountered in research are largely, but not entirely, the result of data constraints, this article assumes that the roots of the problems exhibited by current research might be found in the lack of common approaches among economists and other social scientists. In line with these ideas, there are two main strategies which could lead to a more accurate demonstration of the fact that group memberships plays an important role in the determination of individual economic outcomes. The first one concerns both the necessity of testing the viability of assumptions including more qualitative variables, as  well as the need of supplementing the existing research with new inquiries regarding labor market outcomes of individuals. The second one, representing the core idea of the paper, requires that statistical, quantitative evidence should be combined in the future with qualitative studies and experiments.