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Discrimination as a Competitive Device: The Case of Local Television News

  • Myers Caitlin Knowles

    ()

    (Middlebury College)

Previous studies of discrimination have explored the role that customer prejudice may play in lowering the marginal revenue product of minority employees and, hence, lowering their equilibrium wages. I observe that variation in these types of customer preferences creates an incentive for firms to respond strategically by engaging in product differentiation via the characteristics of their employees. Analysis of data collected for local television news stations supports the predictions of this model of "competitive discrimination." There is a negative correlation between the racial, gender, and age compositions of competing news stations. Moreover, Nielsen ratings for station broadcasts indicate that viewers of stations with more black employees are less discriminatory than viewers of stations with fewer blacks. A similar result is found when examining the age and gender composition of employees.

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Article provided by De Gruyter in its journal The B.E. Journal of Economic Analysis & Policy.

Volume (Year): 8 (2008)
Issue (Month): 1 (August)
Pages: 1-28

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Handle: RePEc:bpj:bejeap:v:8:y:2008:i:1:n:28
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  1. Nardinelli, Clark & Simon, Curtis, 1990. "Customer Racial Discrimination in the Market for Memorabilia: The Case of Baseball," The Quarterly Journal of Economics, MIT Press, vol. 105(3), pages 575-95, August.
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  4. Kate Antonovics & Brian G. Knight, 2009. "A New Look at Racial Profiling: Evidence from the Boston Police Department," The Review of Economics and Statistics, MIT Press, vol. 91(1), pages 163-177, February.
  5. H. J. Holzer & K. R. Ihlanfeldt, . "Customer Discrimination and Employment Outcomes for Minority Workers," Institute for Research on Poverty Discussion Papers 1122-97, University of Wisconsin Institute for Research on Poverty.
  6. Kanazawa, Mark T & Funk, Jonas P, 2001. "Racial Discrimination in Professional Basketball: Evidence from Nielsen Ratings," Economic Inquiry, Western Economic Association International, vol. 39(4), pages 599-608, October.
  7. Paul M. Sommers & Noel Quinton, 1982. "Pay and Performance in Major League Baseball: The Case of the First Family of Free Agents," Journal of Human Resources, University of Wisconsin Press, vol. 17(3), pages 426-436.
  8. Eric Stone & Ronald Warren, 1999. "Customer discrimination in professional basketball: evidence from the trading-card market," Applied Economics, Taylor & Francis Journals, vol. 31(6), pages 679-685.
  9. Kahn, Lawrence M & Sherer, Peter D, 1988. "Racial Differences in Professional Basketball Players' Compensation," Journal of Labor Economics, University of Chicago Press, vol. 6(1), pages 40-61, January.
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