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Sanaz Mobasseri

Boston University Questrom

The Causal Effect of Triadic Closure: How Networks Produce Racial Inequality *

Date: Friday October 11, 2024
Time: 10:30 AM -12:00 PM
Location: Virtual

Abstract:

Research consistently shows that White employees tend to have larger and more advantageous professional networks compared to their Black counterparts. However, there are competing hy- potheses regarding the drivers of these differences. Drawing on theory about the mechanisms underlying tie formation and the conditions under which racial beliefs are activated within organizations, we propose that triadic closure—the process of forming connections through mutual contacts—drives racial disparities in networks beyond what can be explained by un- equal access or direct individual behaviors (e.g., homophily). We further predict that these disparities are most likely in high-stakes work contexts, where heightened work demands and scrutiny activate racial beliefs. To test our hypotheses, we leverage the random assignment of 2,984 new hires to initial project teams in a global professional services firm, allowing us to causally estimate tie formation rates in an organizational setting where initial access to ties is randomly distributed. We find that Black and White new hires form ties at similar rates when interacting directly with coworkers, in the absence of mutual contacts. However, Black new hires are significantly less likely to form ties through shared contacts. This racial gap is most pronounced in high-stakes contexts, such as client-facing projects, where Black employees are 18% less likely to form ties through shared contacts than their White counterparts. These re- sults identify the critical effect of triadic closure for producing racial disparities in networks. Thus, it is essential to understand how organizational practices of relying on networks for employees’ career success inadvertently produce racial inequality in the workplace.