IDEAS home Printed from https://ideas.repec.org/p/vuw/vuwecf/19543.html
   My bibliography  Save this paper

A short note on discrimination and favoritism in the labor market

Author

Listed:
  • Salamanca, Nicolas
  • Feld, Jan

Abstract

We extend Becker’s model of discrimination by allowing firms to have discriminatory and favoring preferences simultaneously. We draw the two-preference parallel for the marginal firm, illustrate the implications for wage differentials, and consider the implied long-run equilibrium. In the short-run, wage differentials depend on relative preferences. However, in the long-run, market forces drive out discriminatory but not favoring firms.

Suggested Citation

  • Salamanca, Nicolas & Feld, Jan, 2016. "A short note on discrimination and favoritism in the labor market," Working Paper Series 19543, Victoria University of Wellington, School of Economics and Finance.
    • Handle: RePEc:vuw:vuwecf:19543
    as

    Download full text from publisher

    File URL: https://ir.wgtn.ac.nz/handle/123456789/19543
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Anthony Edo & Nicolas Jacquemet & Constantine Yannelis, 2019. "Language skills and homophilous hiring discrimination: Evidence from gender and racially differentiated applications," Review of Economics of the Household, Springer, vol. 17(1), pages 349-376, March.
    2. Jacquemet, Nicolas & Yannelis, Constantine, 2012. "Indiscriminate discrimination: A correspondence test for ethnic homophily in the Chicago labor market," Labour Economics, Elsevier, vol. 19(6), pages 824-832.
    3. Chaim Fershtman & Uri Gneezy & Frank Verboven, 2005. "Discrimination and Nepotism: The Efficiency of the Anonymity Rule," The Journal of Legal Studies, University of Chicago Press, vol. 34(2), pages 371-396, June.
    4. Jan Feld & Nicolás Salamanca & Daniel S. Hamermesh, 2016. "Endophilia or Exophobia: Beyond Discrimination," Economic Journal, Royal Economic Society, vol. 126(594), pages 1503-1527, August.
    5. Pierre Cahuc & André Zylberberg, 2004. "Labor Economics," MIT Press Books, The MIT Press, edition 1, volume 1, number 026203316x, December.
    6. Matthew S. Goldberg, 1982. "Discrimination, Nepotism, and Long-Run Wage Differentials," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 97(2), pages 307-319.
    7. Kerwin Kofi Charles & Jonathan Guryan, 2008. "Prejudice and Wages: An Empirical Assessment of Becker's The Economics of Discrimination," Journal of Political Economy, University of Chicago Press, vol. 116(5), pages 773-809, October.
    8. repec:hal:spmain:info:hdl:2441/1oclgdahv988ioh9b24346gvge is not listed on IDEAS
    9. Cahuc, Pierre & Carcillo, Stéphane & Zylberberg, André, 2014. "Labor Economics, second edition," MIT Press Books, The MIT Press, edition 2, volume 1, number 0262027704, December.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Anthony Edo & Nicolas Jacquemet & Constantine Yannelis, 2019. "Language skills and homophilous hiring discrimination: Evidence from gender and racially differentiated applications," Review of Economics of the Household, Springer, vol. 17(1), pages 349-376, March.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Salamanca Nicolas & Feld Jan, 2017. "A Short Note on Discrimination and Favoritism in the Labor Market," The B.E. Journal of Theoretical Economics, De Gruyter, vol. 17(1), pages 1-10, January.
    2. Jan Feld & Nicolás Salamanca & Daniel S. Hamermesh, 2016. "Endophilia or Exophobia: Beyond Discrimination," Economic Journal, Royal Economic Society, vol. 126(594), pages 1503-1527, August.
    3. Anthony Edo & Nicolas Jacquemet & Constantine Yannelis, 2019. "Language skills and homophilous hiring discrimination: Evidence from gender and racially differentiated applications," Review of Economics of the Household, Springer, vol. 17(1), pages 349-376, March.
    4. Bryson, Alex & Chevalier, Arnaud, 2015. "Is there a taste for racial discrimination amongst employers?," Labour Economics, Elsevier, vol. 34(C), pages 51-63.
    5. Dickinson, David L. & Masclet, David & Peterle, Emmanuel, 2018. "Discrimination as favoritism: The private benefits and social costs of in-group favoritism in an experimental labor market," European Economic Review, Elsevier, vol. 104(C), pages 220-236.
    6. Pierre Cahuc & Stéphane Carcillo & Thomas Le Barbanchon, 2019. "The Effectiveness of Hiring Credits," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 86(2), pages 593-626.
    7. Jacquemet, Nicolas & Yannelis, Constantine, 2012. "Indiscriminate discrimination: A correspondence test for ethnic homophily in the Chicago labor market," Labour Economics, Elsevier, vol. 19(6), pages 824-832.
    8. Castillo, Marco & Petrie, Ragan & Torero, Maximo & Vesterlund, Lise, 2013. "Gender differences in bargaining outcomes: A field experiment on discrimination," Journal of Public Economics, Elsevier, vol. 99(C), pages 35-48.
    9. Baert, Stijn, 2017. "Hiring Discrimination: An Overview of (Almost) All Correspondence Experiments Since 2005," GLO Discussion Paper Series 61, Global Labor Organization (GLO).
    10. Ross Levine & Alexey Levkov & Yona Rubinstein, 2008. "Racial Discrimination and Competition," NBER Working Papers 14273, National Bureau of Economic Research, Inc.
    11. Ahmed, Ali M., 2007. "Group identity, social distance and intergroup bias," Journal of Economic Psychology, Elsevier, vol. 28(3), pages 324-337, June.
    12. Dagmar Brožová, 2016. "Forming the Modern Labour Market Economics: On the Role of Institutionalist Theories [Utváření moderní ekonomie trhů práce: neoklasické paradigma s institucionálními teoriemi]," Acta Oeconomica Pragensia, Prague University of Economics and Business, vol. 2016(6), pages 56-68.
    13. Cristian Dario Castillo Robayo & Julimar Da Silva Bichara & Manuel Pérez-Trujillo, 2017. "Retornos salariales para Colombia, un análisis cuantílico," Apuntes del Cenes, Universidad Pedagógica y Tecnológica de Colombia, vol. 36(63), pages 211-246, January.
    14. Marx, Benjamin & Do, Quoc-Anh & Galbiati, Roberto & Ortiz Serrano, Miguel Angel, 2020. "J'Accuse! Antisemitism and Financial Markets in the time of the Dreyfus Affair," CEPR Discussion Papers 14826, C.E.P.R. Discussion Papers.
    15. Marianne Bertrand & Esther Duflo, 2016. "Field Experiments on Discrimination," NBER Working Papers 22014, National Bureau of Economic Research, Inc.
    16. Pierre Deschamps, 2018. "Gender Quotas in Hiring Committees: a Boon or a Bane for Women?," Sciences Po publications 82, Sciences Po.
    17. Rybak, Aurelia & Rybak, Aleksandra, 2016. "Possible strategies for hard coal mining in Poland as a result of production function analysis," Resources Policy, Elsevier, vol. 50(C), pages 27-33.
    18. Steinar Holden & Åsa Rosén, 2014. "Discrimination And Employment Protection," Journal of the European Economic Association, European Economic Association, vol. 12(6), pages 1676-1699, December.
    19. Mazzutti, Caio Cícero Toledo Piza da Costa, 2016. "Three essays on the causal impacts of child labour laws in Brazil," Economics PhD Theses 0616, Department of Economics, University of Sussex Business School.
    20. Nathaniel Hilger, 2016. "Upward Mobility and Discrimination: The Case of Asian Americans," NBER Working Papers 22748, National Bureau of Economic Research, Inc.

    More about this item

    Keywords

    Wage gap; Nepotism; Firm preferences; Long-run equilibrium;
    All these keywords.

    JEL classification:

    • J70 - Labor and Demographic Economics - - Labor Discrimination - - - General
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:vuw:vuwecf:19543. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Library Technology Services (email available below). General contact details of provider: https://edirc.repec.org/data/egvuwnz.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.