Economics and Business Economics Seminar (ECO): Andrei Gorshkov, Uppsala University

Presenter: Andrei Gorshkov, Uppsala University

Fields: Labor Economics

Seminar title: Peers, Heirs, and Careers: Labor Market Effects of Alumni Networks

Host: Rune Majlund Vejlin

Abstract:

How do social connections among business school peers contribute to career success and economic mobility to top jobs? Using long-standing records of student random assignment to tutorial groups at Copenhagen Business School, merged with comprehensive career data from Danish registers, we observe students sharing career similarities with former group peers, surpassing those within the same cohort. The "excessive" tendency to share occupations, industries, and work for the same employers is explained by peers working together at the same workplace. This effect is partially driven by a propensity to work at firms connected to peers' parents. Comparison of job transitions to firms with group peers versus cohort peers suggests that students benefit from their alumni network, accessing higher-paying jobs. The business school has historically attracted students from the economic elite. Students who already share a privileged background have a higher "excess" propensity to work together and gain more from joining firms with their peers. They derive significant career gains from being assigned to peers from rich families, while no similar effects are observed for students from less affluent upbringings. This suggests that complementarity between elite family backgrounds and the effect of connections potentially perpetuates inequality and impedes upward mobility.