What's the Inside Scoop? Challenges in the Supply and Demand for Information on Employers
56 Pages Posted: 16 Jun 2020 Last revised: 21 Aug 2021
Date Written: September 15, 2020
Workers struggle to understand prospective employers. Through experienced workers' volunteered reviews, Glassdoor is a platform that seeks to provide information about prospective employers to jobseekers. We find that the content most valuable to jobseekers (negative information) is the kind most risky to supply, pointing to a Catch-22. Higher ratings increase labor supply to less well-known firms, creating an incentive for smaller firms to discourage negative reviews. Concerns about employer retaliation discourage negative reviews and motivate employees who do disclose to conceal aspects of their identity, degrading the information’s value. Reputation institutions provide valuable but partial solutions to workers' information problems.
Keywords: Imperfect Information, Job Search, Job Satisfaction, Employer Retaliation
JEL Classification: J3, J28, D83, J62
Suggested Citation: Suggested Citation