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Gender Discrimination Estimation In A Search Model With Matching And Bargaining

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  • Luca Flabbi

Abstract

This article develops a search model of the labor market with matching, bargaining, and employers' taste discrimination in which-under necessary but standard distributional assumption-it is possible to separately identify gender discrimination and unobserved productivity differences. The equilibrium shows that both prejudiced and unprejudiced employers wage discriminate. Maximum likelihood estimates on CPS data indicate that half of the employers are prejudiced, average female productivity is 6.5% lower, and two-third of the gender earning differential may be explained by prejudice. An affirmative action policy is implemented resulting in a redistribution of welfare from men to women at no cost for employers' welfare. Copyright (2010) by the Economics Department of the University of Pennsylvania and the Osaka University Institute of Social and Economic Research Association.

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Bibliographic Info

Article provided by Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association in its journal International Economic Review.

Volume (Year): 51 (2010)
Issue (Month): 3 (08)
Pages: 745-783

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Handle: RePEc:ier:iecrev:v:51:y:2010:i:3:p:745-783

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Citations

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Cited by:
  1. Luca Flabbi and James Mabli, 2012. "Household Search or Individual Search: Does It Matter? Evidence from Lifetime Inequality Estimates," Working Papers gueconwpa~12-12-03, Georgetown University, Department of Economics.
  2. repec:hal:journl:halshs-00193372 is not listed on IDEAS
  3. Ambra Poggi, 2008. "Job satisfaction, working conditions and job-expectations," LABORatorio R. Revelli Working Papers Series 74, LABORatorio R. Revelli, Centre for Employment Studies.
  4. Luca Flabbi, 2004. "Gender Discrimination Estimation in a Search Model with Matching and Bargaining," 2004 Meeting Papers 367, Society for Economic Dynamics.
  5. Marco Leonardi & Luca Flabbi, 2008. "Sources of Earnings Instability: Estimates from an On-the-Job Search Model of the U.S. Labor Market," 2008 Meeting Papers 308, Society for Economic Dynamics.
  6. Flabbi, Luca & Moro, Andrea, 2012. "The effect of job flexibility on female labor market outcomes: Estimates from a search and bargaining model," Journal of Econometrics, Elsevier, vol. 168(1), pages 81-95.
  7. Sara Rica & Juan Dolado & Cecilia Garcia Peñalosa, 2012. "GINI DP 24: On gender gaps and self-fulfilling expectations: An alternative approach based on paid-for-training," GINI Discussion Papers 24, AIAS, Amsterdam Institute for Advanced Labour Studies.
  8. Flabbi, Luca, 2010. "Prejudice and gender differentials in the US labor market in the last twenty years," Journal of Econometrics, Elsevier, vol. 156(1), pages 190-200, May.
  9. Liu, Kai, 2012. "Explaining the Gender Wage Gap: Estimates from a Dynamic Model of Job Changes and Hours Changes," Discussion Paper Series in Economics 15/2012, Department of Economics, Norwegian School of Economics.
  10. Giovanni Sulis, 2007. "Gender Wage Differentials in Italy: a Structural Estimation Approach," Working Paper CRENoS 200715, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.
  11. repec:aia:ginidp:dp24 is not listed on IDEAS
  12. Usui, Emiko, 2012. "Gender Occupational Segregation in an Equilibrium Search Model," CIS Discussion paper series 560, Center for Intergenerational Studies, Institute of Economic Research, Hitotsubashi University.
  13. Waisman, Gisela & Larsen, Birthe, 2008. "Who is Hurt by Discimination?," SULCIS Working Papers 2008:4, Stockholm University Linnaeus Center for Integration Studies - SULCIS.
  14. Flabbi, Luca & Leonardi, Marco, 2010. "Sources of earnings inequality: Estimates from an on-the-job search model of the US labor market," European Economic Review, Elsevier, vol. 54(6), pages 832-854, August.

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