Experience-based Discrimination

Louis-Pierre Lepage ()
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Louis-Pierre Lepage: Swedish Institute for Social Research, Stockholm University, Postal: SOFI, Stockholm University, SE-106 91 Stockholm, Sweden

No 12/2023, Working Paper Series from Stockholm University, Swedish Institute for Social Research

Abstract: I study discrimination arising from individual experiences of employers with worker groups. I present a model in which employers are uncertain about the productivity of one of two groups and learn through hiring. Positive experiences lead to positive biases which correct themselves by leading to more hiring and learning. Negative experiences decrease hiring and learning, preserving negative biases which can cause persistent discrimination. The model explains prejudice as “incorrect” statistical discrimination and generates novel predictions and policy implications. I then illustrate experience- based discrimination in an experimental labor market, finding support for key model predictions.

Keywords: labor market discrimination; employer learning; biased beliefs; hiring (search for similar items in EconPapers)
JEL-codes: D83 J71 M50 (search for similar items in EconPapers)
Pages: 71 pages
Date: 2023-10-01
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:hhs:sofiwp:2023_012

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