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Asymmetric information, strategic behavior, and discrimination in the labor market

Kolpin Van and Larry Singell
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Kolpin Van: Department of Economics, 1285 University of Oregon, Eugene, OR 97403-1285, USA
Larry Singell: Department of Economics, 1285 University of Oregon, Eugene, OR 97403-1285, USA

Economic Theory, 1997, vol. 10, issue 1, 175-184

Abstract: The neoclassical model of labor market discrimination assumes the presence of either prejudiced preferences, biased assessments of worker productivity, or monopsony power. We show that when market agents control asymmetric information, strategic behavior can induce discriminatory hiring practices even when these market features are absent. Moreover, strategic interaction many distort public policies to the point of harming the segments of the work force they were designed to support.

JEL-codes: C72 D82 J71 (search for similar items in EconPapers)
Date: 1997
Note: Received: January 3, 1996 revised version April 29, 1996
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Citations: View citations in EconPapers (6)

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