Do Social Networks Inspire Employment?

There is robust ¯eld data showing that a frequent and successful way of looking for a job is via the intermediation of friends and relatives. Here we want to test this experimentally. Participants ¯rst play a simple public goods game with two interaction partners (\friends"), and share whatever they earn this way with two di®erent sharing partners (\cousins") who have di®erent friends. Thus one's so-cial network contains two \friends " and two \cousins". In the second phase of the experiment participants learn about a job opportunity for themselves and one ad-ditional vacancy and decide whom of their network they want to recommend and, if so, in which order. In case of coemployment, both employees compete for a bonus. Will one recommend others for the additional job in spite of this competition, will one prefer \friends " or \cousins " and how does this depend on contributions (of \friends") or shared pro¯ts (with \cousins")? Our ¯ndings are partly quite puz-zling. Most participants, for instance, recommend quite actively but compete very ¯ercely for the bonus