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Detecting Discrimination in Audit and Correspondence Studies

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  • David Neumark

Abstract

Audit studies testing for discrimination have been criticized because applicants from different groups may not appear identical to employers. Correspondence studies address this criticism by using fictitious paper applicants whose qualifications can be made identical across groups. However, Heckman and Siegelman (1993) show that group differences in the variance of unobservable determinants of productivity still can generate spurious evidence of discrimination in either direction. This paper shows how to recover an unbiased estimate of discrimination when the correspondence study includes variation in applicant characteristics that affect hiring. The method is applied to actual data and assessed using Monte Carlo methods.

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Bibliographic Info

Article provided by University of Wisconsin Press in its journal Journal of Human Resources.

Volume (Year): 47 (2012)
Issue (Month): 4 ()
Pages: 1128-1157

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Handle: RePEc:uwp:jhriss:v:47:y:2012:iv:1:p:1128-1157

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References

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  1. P. A. Riach & J. Rich, 2002. "Field Experiments of Discrimination in the Market Place," Economic Journal, Royal Economic Society, vol. 112(483), pages 480-518, November.
  2. Hellerstein, Judith K & Neumark, David, 1999. "Sex, Wages, and Productivity: An Empirical Analysis of Israeli Firm-Level Data," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 40(1), pages 95-123, February.
  3. Neumark, David, 1996. "Sex Discrimination in Restaurant Hiring: An Audit Study," The Quarterly Journal of Economics, MIT Press, vol. 111(3), pages 915-41, August.
  4. Lundberg, Shelly J & Startz, Richard, 1983. "Private Discrimination and Social Intervention in Competitive Labor Markets," American Economic Review, American Economic Association, vol. 73(3), pages 340-47, June.
  5. Joanna Lahey, 2005. "Age, Women, and Hiring: An Experimental Study," NBER Working Papers 11435, National Bureau of Economic Research, Inc.
  6. Lahey, Joanna N. & Beasley, Ryan A., 2009. "Computerizing audit studies," Journal of Economic Behavior & Organization, Elsevier, vol. 70(3), pages 508-514, June.
  7. Riach, Peter A. & Rich, Judy, 2007. "An Experimental Investigation of Age Discrimination in the Spanish Labour Market," IZA Discussion Papers 2654, Institute for the Study of Labor (IZA).
  8. William A. Darity & Patrick L. Mason, 1998. "Evidence on Discrimination in Employment: Codes of Color, Codes of Gender," Journal of Economic Perspectives, American Economic Association, vol. 12(2), pages 63-90, Spring.
  9. Hellerstein, Judith K. & Neumark, David, 2005. "Using Matched Employer-Employee Data to Study Labor Market Discrimination," IZA Discussion Papers 1555, Institute for the Study of Labor (IZA).
  10. Cornelißen, Thomas, 2005. "Standard errors of marginal effects in the heteroskedastic probit model," Hannover Economic Papers (HEP) dp-320, Leibniz Universität Hannover, Wirtschaftswissenschaftliche Fakultät.
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Citations

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Cited by:
  1. Azmat, Ghazala & Petrongolo, Barbara, 2014. "Gender and the Labor Market: What Have We Learned from Field and Lab Experiments?," IZA Discussion Papers 8135, Institute for the Study of Labor (IZA).
  2. John M. Nunley & Adam Pugh & Nicholas Romero & Richard Alan Seals, Jr., 2014. "An Examination of Racial Discrimination in the Labor Market for Recent College Graduates: Estimates from the Field," Auburn Economics Working Paper Series auwp2014-06, Department of Economics, Auburn University.
  3. Zhou, Xiangyi & Zhang, Jie & Song, Xuetao, 2013. "Gender Discrimination in Hiring: Evidence from 19,130 Resumes in China," MPRA Paper 43543, University Library of Munich, Germany.
  4. Hedegaard, Morten & Tyran, Jean-Robert, 2014. "The Price of Prejudice," CEPR Discussion Papers 9953, C.E.P.R. Discussion Papers.
  5. Anthony Edo & Nicolas Jacquemet & Constantine Yannelis, 2013. "Language Skills and Homophilous Hiring Discrimination: Evidence from Gender-and Racially-Differentiated Applications," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-00877458, HAL.
  6. Baert, Stijn, 2013. "Career Lesbians: Getting Hired for Not Having Kids?," IZA Discussion Papers 7767, Institute for the Study of Labor (IZA).
  7. Stijn BAERT & Baert COCKX & Niels GHEYLE & Cora VANDAMME, 2013. "Do Employers Discriminate Less if Vacancies Are Difficult to Fill? Evidence From a Field Experiment," Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) 2013001, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
  8. Eva Olimpia Arceo Gómez & Raymundo Campos-Vázquez, 2013. "Race and Marriage in the Labor Market: A Discrimination Correspondence Study in a Developing Country," Working papers DTE 553, CIDE, División de Economía.
  9. Ghazala Azmat & Barbara Petrongolo, 2014. "Gender and the Labor Market: What Have We Learned from Field and Lab Experiments?," CEP Occasional Papers 40, Centre for Economic Performance, LSE.

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