Mouw, Ted (2002). Are Black Workers Missing the Connection? The Effect of Spatial Distance and Employee Referrals on Interfirm Racial Segregation. Demography, 39(3)
I use data on the hiring practices and spatial location of firms in four cities to model the process of interfirm racial segregation. When I control for the spatial location of the firm, the use of employee referrals reduced the probability of hiring a black worker by 75% in firms that are less than 10% black. Among all firms, the results suggest that employee referrals are just as important as the geographic location of the firm in generating employment segregation: both increase the predicted level of interfirm racial segregation among blue-collar workers in the cities studied by about 10%.