This paper explores the implications of culturally biased testing for the employment decisions of firms. Only the workers know whether they can do the job or not so firms test them. Wages are made contingent on the test results which are public information. The threshold result for hiring corresponds to the minimum wage acceptable to qualified workers. Assuming the test is less able to discern the ability of minority workers, the paper looks at the implications for antidiscrimination employment and wage policies
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Paper provided by Society for Economic Dynamics in its series 2004 Meeting Papers with number
333.
Length: Date of creation: 2004 Date of revision: Handle: RePEc:red:sed004:333
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Find related papers by JEL classification: J15 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Minorities and Races; Non-labor Discrimination J41 - Labor and Demographic Economics - - Particular Labor Markets - - - Labor Contracts
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