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Measuring discrimination using principles of stochastic dominance

Michael Hoy () and Rachel Huang ()

Journal of Economic Theory, 2017, vol. 167, issue C, 39-52

Abstract: This note develops a new approach to measuring discrimination. A partial ordering of discrimination patterns is proposed that is consistent with the properties of second-degree stochastic dominance (SSD), which are related to changes in the distributions of either the reference (advantaged) or comparison (disadvantaged) group, while keeping the other group's distribution unchanged. Furthermore, a corresponding summary index is derived. This index provides a complete ordering to rank discrimination patterns and also satisfies the principles of SSD.

Keywords: Discrimination; Stochastic dominance (search for similar items in EconPapers)
JEL-codes: D30 J70 (search for similar items in EconPapers)
Date: 2017
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Handle: RePEc:eee:jetheo:v:167:y:2017:i:c:p:39-52