lecture22_Nov16

lecture22_Nov16 - Discrimination: Basic Issues and Theories...

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Discrimination:  Basic Issues and Theories (continued)
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Statistical Discrimination: Theory § Should decline if employers obtain better information  about prospective candidates § Should also diminish over time once starting  employment § Employers learn about individual employee’s productivity § Why might race or gender predict quality of work? § Criminal record example
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Testing Statistical Discrimination:  Criminal Background Checks   § Do employers who use criminal background checks  hire more African Americans (controlling for other  firm characteristics)? § If yes: evidence that firms without checks are  discriminating against blacks to approximate criminal  background information § If no: statistical discrimination may still exist but firms are  accurately estimating  the fraction of African Americans  with criminal backgrounds
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Data and Results § Researchers examined data from 3,000 employers  in Atlanta, Boston, Detroit, and Los Angeles § Firms that use criminal background checks are  about 40% more likely to hire an African-American  male. § Implication: In absence of checks, firms  overestimated likelihood of criminal record among  African-American males § Increases in background checks would REDUCE the  statistical discrimination against African Americans
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Theories of Labor Market Discrimination § Personal prejudice: Employer and Customer § Statistical discrimination § Self-confirming expectations
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6 Self-confirming expectations
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This note was uploaded on 02/03/2012 for the course ECON 375 taught by Professor Staff during the Fall '10 term at Maryland.

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lecture22_Nov16 - Discrimination: Basic Issues and Theories...

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