Labour Market Performance Effects of Discrimination and Loss of Skill

Birthe Larsen and Gisela Waisman
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Gisela Waisman: Regeringskansliet, Stockholm

No 02-2015, Working Papers from Copenhagen Business School, Department of Economics

Abstract: We examine the impact of discrimination on labour market performance when workers are subject to a risk of losing skills during an unemployment experience. Within a search and matching framework, we show that both natives and immigrants are affected by discrimination. Discrimination in one sector has positive spill-overs, inducing employment to increase in the other sector and the effect on labour market performance therefore depends on whether discrimination is present in only one sector or in both sectors. Discrimination may induce workers to train more or less than natives after having lost their skills, dependent upon which sector there is discrimination. Net output tends to the be most negatively affected by discrimination among high-skilled workers

Keywords: discrimination; unemployment; search and matching; wages (search for similar items in EconPapers)
JEL-codes: J15 J31 J61 J64 J71 (search for similar items in EconPapers)
Pages: 38 pages
Date: 2015-07-21
New Economics Papers: this item is included in nep-lab
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Citations: View citations in EconPapers (2)

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Related works:
Journal Article: LABOR MARKET PERFORMANCE EFFECTS OF DISCRIMINATION AND LOSS OF SKILL (2016)
Working Paper: Labour Market Performance Effects of Discrimination and Loss of Skill (2012)
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