Skill Uncertainty and Social Inference

Robert J. Oxoby ()

No 2567, IZA Discussion Papers from Institute for the Study of Labor (IZA)

Abstract: Research in psychology indicates that individuals often make inferences regarding unknown individual qualities based on potentially irrelevant (but socially observable) information. This paper explores occupational choices when individuals receive imprecise signals regarding ability and use the observable characteristics of previously successful individuals to infer own ability. Individuals who fail to observe successful predecessors of their same type may underestimate their potential for success in the occupation. We discuss the role of these biases in light of the literature on affirmative action and firm incentives.

Keywords: social Inference; occupational choice; discrimination (search for similar items in EconPapers)
JEL-codes: D63 D83 J64 J70 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cbe and nep-soc
Date: 2007-01
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Journal Article: Skill uncertainty and social inference (2008)
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