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Do firms redline workers?

Ana Diaz Escobar and Luz Magdalena Salas

Regional Science and Urban Economics, 2020, vol. 83, issue C

Abstract: Firms statistically discriminate (redline) against job candidates based on where they live. We conducted a correspondence test by sending three identical fictitious resumes to every non-professional job offer posted in two main job vacancy newspapers in Bogota. The only difference between the resumes was the residential address in which the applicants lived. Two of the three resumes sent in each trio were located with the same commuting time (and geographical distance) from the job, but one resided in a low-crime neighborhood and the other in a high-crime neighborhood. The third resume was for a fictitious individual located in a low-crime neighborhood that was further away (longer commuting time and greater distance). We find that employers statistically discriminate (redline) based on commuting time to work. In particular, living a half-hour away from the vacancy reduces the callback rate by 14 percent while holding the attributes of the place of residence constant. We did not find evidence that employers respond to neighborhood effects.

Keywords: Statistical discrimination; Productivity; Employment; Neighborhood effects; Spatial mismatch; Correspondence test (search for similar items in EconPapers)
JEL-codes: C93 D22 J21 J23 J71 R23 (search for similar items in EconPapers)
Date: 2020
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Persistent link: https://EconPapers.repec.org/RePEc:eee:regeco:v:83:y:2020:i:c:s0166046219302637

DOI: 10.1016/j.regsciurbeco.2020.103541

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