Job Contact Networks, Inequality and Aggregate Output

Andrea Mario Lavezzi, Nicola Meccheri, Andrea Mario Lavezzi

Research output: Chapter in Book/Report/Conference proceedingChapter

1 Citation (Scopus)

Abstract

In this paper we study the effects of social networks on wage inequality and aggregate production. In particular, we consider a simplified version of the model by Calvò-Armengol and Jackson (2003), with good and bad jobs and skilled and unskilled workers. Our findings are: i) increasing the number of social links increases aggregate output and may reduce inequality; ii) given a number of social connections, output increases if the average distance among worker decreases; iii) a more mixed and well-integrated society, that is a society in which heterogeneous workers share social links, produces more output and less inequality than a society in which some workers are isolated, when productivity of the most productive agents in the best jobs is sufficiently low. We draw some policy implications from these results.
Original languageEnglish
Title of host publicationInnovation, Unemployment and Policy in the Theories of Growth and Distribution
Pages145-167
Publication statusPublished - 2005

All Science Journal Classification (ASJC) codes

  • General Economics,Econometrics and Finance

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