Looking for a Job and Borrowing Money: Uncertainty and the Reliance on Strong Ties

Abstract

Analyses regularly document that even in advanced post-industrial societies social networks are relied on when searching for a job or borrowing money, particularly in situations of uncertainty. Our main goal within this paper is to test whether the preference for strong ties when looking for a job and borrowing money varies systematically between individuals and countries. We test if this variability can be explained by experiencing insecurity connected to low social position, or by general uncertainty at the country level—such as uncertainty connected to perceived corruption and a low level of interpersonal trust. Our analysis therefore combines individual level data from the ISSP 2017 Social networks module with country level contextual variables. We find support for a clear link between the reliance on strong ties and personal as well as country level uncertainty in the case of looking for a job. With borrowing money, the link between low social position and reliance on strong ties remains strong, while the impact of society level measures of uncertainty is less clear. We ascribe this to the exclusion of people with low social status from formal financial services regardless of the overall level of uncertainty in a country.