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Search, Bargaining and Employer Discrimination

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Author Info

  • Rosen, A.

Abstract

This paper analyses Becker's (1971) theory of employer discrimination within a search and wage-bargaining setting. Discriminatory firms pay workers who are discriminated against less, and apply stricter hiring-criteria to these workers. It is shown that the highest profits are realized by firms with a positive discrimination coefficient. Moreover, once ownership and control are separated, both highest profits and highest utility may be realized by firms with a positive discrimination coefficient. Thus, market forces, like entry and/or takeovers do not ensure that wage differentials due to employer discrimination will disappear.

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Bibliographic Info

Paper provided by Uppsala - Working Paper Series in its series Papers with number 1998-13.

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Length: 30 pages
Date of creation: 1998
Date of revision:
Handle: RePEc:fth:uppaal:1998-13

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Postal: UPPSALA UNIVERSITY, DEPARTMENT OF ECONOMICS, S-751 20 UPPSALA SWEDEN.
Phone: + 46 18 471 25 00
Fax: + 46 18 471 14 78
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Web page: http://www.nek.uu.se/
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Keywords: BARGAINING ; DISCRIMINATION;

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References

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  1. Sasaki, Masaru, 1999. "An Equilibrium Search Model with Coworker Discrimination," Journal of Labor Economics, University of Chicago Press, vol. 17(2), pages 377-407, April.
  2. Pissarides, Christopher A, 1985. "Short-run Equilibrium Dynamics of Unemployment Vacancies, and Real Wages," American Economic Review, American Economic Association, vol. 75(4), pages 676-90, September.
  3. A Rosen, 1992. "An Equilibrium Search-Matching Model of Discrimination," CEP Discussion Papers dp0097, Centre for Economic Performance, LSE.
  4. Black, Dan A, 1995. "Discrimination in an Equilibrium Search Model," Journal of Labor Economics, University of Chicago Press, vol. 13(2), pages 309-33, April.
  5. Daron Acemoglu, 1998. "Changes in Unemployment and Wage Inequality: An Alternative Theory and Some Evidence," NBER Working Papers 6658, National Bureau of Economic Research, Inc.
  6. James F. Ragan & Carol Horton Tremblay, 1988. "Testing for Employee Discrimination by Race and Sex," Journal of Human Resources, University of Wisconsin Press, vol. 23(1), pages 123-137.
  7. Kimberly Bayard & Judith Hellerstein & David Neumark & Kenneth Troske, 1999. "New Evidence on Sex Segregation and Sex Differences in Wages from Matched Employee-Employer Data," NBER Working Papers 7003, National Bureau of Economic Research, Inc.
  8. Judith K. Hellerstein & David Neumark & Kenneth R. Troske, 1998. "Market Forces and Sex Discrimination," Labor and Demography 9807002, EconWPA.
  9. Bowlus, Audra J & Eckstein, Zvi, 1998. "Discrimination and Skill Differences in an Equilibrium Search Model," CEPR Discussion Papers 1859, C.E.P.R. Discussion Papers.
  10. George J. Borjas & Stephen G. Bronars, 1988. "Consumer Discrimination and Self-Employment," NBER Working Papers 2627, National Bureau of Economic Research, Inc.
  11. Joni Hersch, 1991. "Equal Employment Opportunity Law and Firm Profitability," Journal of Human Resources, University of Wisconsin Press, vol. 26(1), pages 139-153.
  12. Erica L. Groshen, 1991. "The Structure of the Female/Male Wage Differential: Is It Who You Are, What You Do, or Where You Work?," Journal of Human Resources, University of Wisconsin Press, vol. 26(3), pages 457-472.
  13. Kennan, John & Wilson, Robert, 1993. "Bargaining with Private Information," Journal of Economic Literature, American Economic Association, vol. 31(1), pages 45-104, March.
  14. Audra J. Bowlus & Zvi Eckstein, 1998. "Discrimination and Skill Differences in an Equilibrium Search Model," Tinbergen Institute Discussion Papers 98-112/3, Tinbergen Institute.
  15. Sattinger, Michael, 1996. "Search and discrimination," Labour Economics, Elsevier, vol. 3(2), pages 143-167, September.
  16. Pissarides, C A, 1984. "Efficient Job Rejection," Economic Journal, Royal Economic Society, vol. 94(376a), pages 97-108, Supplemen.
  17. repec:dgr:uvatin:2098112 is not listed on IDEAS
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