Join us on April 3, as we hear from David Yanagizawa-Drott, professor of Development and Emerging Markets in the Economics Department at the University of Zurich, as part of the 2025 Stone Inequality Seminar Series. Yanagizawa-Drott will be presenting his paper, titled “Finding Talent in the Age of AI.”
Abstract
The recent mass adoption of generative artificial intelligence (AI), catalyzed by the rise of ChatGPT, has changed matching in labor markets. On the demand side, employers increasingly rely on AI to search for and screen potential candidates, while on the supply side, job seekers use AI to enhance their applications. We study this two-sided phenomenon by experimentally embedding a standard AI algorithm (GPT-4) into an organization’s screening process for teacher recruitment. We find that fully automating this process increases hiring success by approximately 11 percentage points (a 70% improvement). However, when using the same algorithm as an assistant, evaluators frequently override its recommendations, and this assistance does not improve downstream hiring outcomes. We check whether this demand-side behavior can be explained by the wide-spread use of LLMs on the supply side, when writing application essays. We document that approximately 60% of applicants rely on LLM-generated text. Compared to the algorithm, human screeners tend to discount such applications, despite this not being part of the formal screening criteria. They also override the algorithmic decisions more often when the application questions are written using an LLM. Our results indicate that AI usage on the supply side affects decision-making on the demand side, including the effectiveness of algorithms as recruitment aids, and they suggest that automating the screening process can enhance labor market matching efficiency.
Event Details
Date: April 3, 2025
Time: 3:30 – 5:00pm
Location: Iona 533, 6000 Iona Dr, Vancouver, BC
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David Yanagizawa-Drott joined the Economics Department at the University of Zurich in 2016 as Professor of Development and Emerging Markets. Yanagizawa-Drott’s research interests include development economics and political economy, broadly speaking. His current focus is on understanding the drivers of culture and norms in shaping labor markets for men and women; the role of social media and artificial intelligence in society, and; health care in developing countries.