Abstract
This paper models employers’ incentives for discrimination against ex ante identical groups of workers when the workers must compete for a limited number of positions. Employers benefit from discrimination against minority workers because it can reduce the overall risk from workers’ noisy signals by increasing the expected quality of “majority” workers and their chance to win the competition for the limited number of positions. We show that employers can influence the selection of a discriminatory equilibrium by choosing the set of finalists in competition primarily from a majority group, and favoring them when the two groups are equally qualified. We discuss the implications of equal opportunity laws in this context.
| Original language | English |
|---|---|
| Pages (from-to) | 141-160 |
| Number of pages | 20 |
| Journal | Journal of Economic Behavior and Organization |
| Volume | 136 |
| DOIs | |
| Publication status | Published - 2017 Apr 1 |
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Keywords
- Asymmetric information
- Cross-group risks
- Group inequality
- Statistical discrimination
ASJC Scopus subject areas
- Economics and Econometrics
- Organizational Behavior and Human Resource Management
Cite this
Incentives for discrimination. / Mialon, Sue H.; Yoo, Seung Han.
In: Journal of Economic Behavior and Organization, Vol. 136, 01.04.2017, p. 141-160.Research output: Contribution to journal › Article
}
TY - JOUR
T1 - Incentives for discrimination
AU - Mialon, Sue H.
AU - Yoo, Seung Han
PY - 2017/4/1
Y1 - 2017/4/1
N2 - This paper models employers’ incentives for discrimination against ex ante identical groups of workers when the workers must compete for a limited number of positions. Employers benefit from discrimination against minority workers because it can reduce the overall risk from workers’ noisy signals by increasing the expected quality of “majority” workers and their chance to win the competition for the limited number of positions. We show that employers can influence the selection of a discriminatory equilibrium by choosing the set of finalists in competition primarily from a majority group, and favoring them when the two groups are equally qualified. We discuss the implications of equal opportunity laws in this context.
AB - This paper models employers’ incentives for discrimination against ex ante identical groups of workers when the workers must compete for a limited number of positions. Employers benefit from discrimination against minority workers because it can reduce the overall risk from workers’ noisy signals by increasing the expected quality of “majority” workers and their chance to win the competition for the limited number of positions. We show that employers can influence the selection of a discriminatory equilibrium by choosing the set of finalists in competition primarily from a majority group, and favoring them when the two groups are equally qualified. We discuss the implications of equal opportunity laws in this context.
KW - Asymmetric information
KW - Cross-group risks
KW - Group inequality
KW - Statistical discrimination
UR - http://www.scopus.com/inward/record.url?scp=85014750230&partnerID=8YFLogxK
UR - http://www.scopus.com/inward/citedby.url?scp=85014750230&partnerID=8YFLogxK
U2 - 10.1016/j.jebo.2017.01.021
DO - 10.1016/j.jebo.2017.01.021
M3 - Article
AN - SCOPUS:85014750230
VL - 136
SP - 141
EP - 160
JO - Journal of Economic Behavior and Organization
JF - Journal of Economic Behavior and Organization
SN - 0167-2681
ER -