EconPapers    
Economics at your fingertips  
 

Labor Market Discrimination and Capital Investment: The Effects of Fan Discrimination on Stadium Investment

Orn Bodvarsson and Brad Humphreys

No 4551, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: We investigate the possibility that labor market discrimination affects economic outcomes in the complementary capital market. Previous research contains ample theoretical justification, and empirical evidence, that discrimination affects wages and employment in labor markets. However, the effects of discrimination against minority labor on transactions in markets for other inputs used in production are not known. We develop a model of the optimal capital stock put in place in the presence of customer discrimination and test this model using data on sports facility construction over the period 1950-2004. The empirical evidence suggests that teams in cities with more racial segregation spend less on sports facilities, confirming the predictions of the model about the effect of customer discrimination on capital investment.

Keywords: racial discrimination; capital stock; complementarity; stadium financing (search for similar items in EconPapers)
JEL-codes: J15 (search for similar items in EconPapers)
Pages: 25 pages
Date: 2009-11
New Economics Papers: this item is included in nep-lab, nep-spo and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://docs.iza.org/dp4551.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:iza:izadps:dp4551

Ordering information: This working paper can be ordered from
IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany

Access Statistics for this paper

More papers in IZA Discussion Papers from Institute of Labor Economics (IZA) IZA, P.O. Box 7240, D-53072 Bonn, Germany. Contact information at EDIRC.
Bibliographic data for series maintained by Holger Hinte ().

 
Page updated 2024-04-15
Handle: RePEc:iza:izadps:dp4551