Referral Screening Capacity Asymmetry
RCTReview
Employers frequently assume all current employees possess equal capacity to identify high-skilled candidates within their social networks. Without measuring referrer ability, firms cannot determine whether poor referrals stem from misaligned financial incentives or a fundamental lack of referrer evaluation skill.
Picture this
Think of a master chef versus a novice cook tasked with recruiting a new line cook. The master chef recognizes talent and can select a top tier chef when offered a reward, whereas the novice cook cannot evaluate high talent and fails to recruit a skilled chef under any reward structure.
What the evidence says
High-ability original participants successfully selected high-skilled referrals when offered performance-based pay, whereas low-ability original participants failed to recruit high-skilled candidates under any incentive structure.
- Who was studied
- 562 original participants and 407 referrals (adult males aged 18 to 60) in Kolkata, India.
- How
- Laboratory RCT evaluating cognitive ability using Raven's matrices, digit span tests, and rule-based quilt design tasks for both original participants and their referrals.
What to do
Target performance-based referral incentives specifically toward top-performing current employees rather than broadcasting referral solicitations uniformly across the entire workforce.
From the source
"They found that high-ability participants only referred high-skilled candidates when offered performance incentives, and low-ability participants failed to refer high-skilled candidates under any incentive structure."
Leveraging Social Networks for Job Referrals in India.pdf