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Discrimination and Workers' Expectations: Experimental Evidence

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  • Filippin, Antonio

    () (University of Milan)

Abstract

This paper is an experimental analysis of the role played by workers’ expectations in explaining the puzzling long-run persistence of observed discrimination against certain minorities in the labor market. The experiment provides some evidence supporting the theoretical prediction that unequal outcomes may emerge due to disadvantaged workers’ wrong expectations of being discriminated against. However, this effect is not long-lasting, since players learn the true state of nature in later stages of the experiment, failing to generate a Self-Confirming Equilibrium driven by wrong beliefs. The strategy method provides additional evidence that expectations matter.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 824.

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Length: 34 pages
Date of creation: Jul 2003
Date of revision:
Handle: RePEc:iza:izadps:dp824

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Keywords: experiments; discrimination; workers’ expectations;

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References

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  2. Lazear, Edward P & Rosen, Sherwin, 1981. "Rank-Order Tournaments as Optimum Labor Contracts," Journal of Political Economy, University of Chicago Press, vol. 89(5), pages 841-64, October.
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  6. Filippin, Antonio, 2003. "Discrimination and Workers' Expectations," IZA Discussion Papers 823, Institute for the Study of Labor (IZA).
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  8. Filippin, Antonio & Ichino, Andrea, 2003. "Gender Wage Gap in Expectations and Realizations," IZA Discussion Papers 825, Institute for the Study of Labor (IZA).
  9. Simon P. Anderson & Jacob K. Goeree & Charles A. Holt, 1998. "Rent Seeking with Bounded Rationality: An Analysis of the All-Pay Auction," Journal of Political Economy, University of Chicago Press, vol. 106(4), pages 828-853, August.
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  17. Banerjee, Abhijit V, 1992. "A Simple Model of Herd Behavior," The Quarterly Journal of Economics, MIT Press, vol. 107(3), pages 797-817, August.
  18. Sushil Bikhchandani & David Hirshleifer & Ivo Welch, 2010. "A theory of Fads, Fashion, Custom and cultural change as informational Cascades," Levine's Working Paper Archive 1193, David K. Levine.
  19. Roth, Alvin E, 1994. "Lets Keep the Con out of Experimental Econ.: A Methodological Note," Empirical Economics, Springer, vol. 19(2), pages 279-89.
  20. Anderson, Lisa R & Holt, Charles A, 1997. "Information Cascades in the Laboratory," American Economic Review, American Economic Association, vol. 87(5), pages 847-62, December.
  21. Holm, Håkan, 2000. "Stereotypes, Sex Discrimination and Paranoia - an experimental study," Working Papers 2000:1, Lund University, Department of Economics, revised 01 Jul 2000.
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Cited by:
  1. Filippin, Antonio & Ichino, Andrea, 2003. "Gender Wage Gap in Expectations and Realizations," IZA Discussion Papers 825, Institute for the Study of Labor (IZA).
  2. Filippin, Antonio, 2003. "Discrimination and Workers' Expectations," IZA Discussion Papers 823, Institute for the Study of Labor (IZA).

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