Overattention to First-Hand Experience in Hiring Decisions: Evidence from Professional Basketball
65 Pages Posted: 10 Jul 2019
Date Written: July 8, 2019
We provide evidence from the market for NBA basketball players that employers' hiring decisions rely too heavily on first-hand experiences with job candidates. Specifically, we find that employers are biased in favor of acquiring players with better-than-usual performances when the employer’s team was playing or preparing to play the player’s original team. Our estimates imply that performance information receives approximately 1.8 times more weight in hiring decisions if it is conveyed through first-hand experience. According to our simulations, such "overattention" leads to a 2.3% rate of mismatch between employers and workers.
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