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Combining discrimination diagnostics to identify sources of statistical discrimination

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  • Domínguez, Patricio
  • Grau, Nicolás
  • Vergara, Damián

Abstract

Statistical discrimination is usually flagged by economists as a potential source of treatment disparities. The literature, however, lacks reduced-form tests that provide information about the relative importance of statistical discrimination in explaining aggregate patterns. This article explores whether combining three different diagnostics of aggregate discrimination – those being, unconditional treatment disparities, benchmark tests, and outcome tests – can provide insights into sources of statistical discrimination. We discuss the difficulties concomitant with this exercise and argue, using an identification result that relies on restrictive (and presumably implausible) assumptions, that the answer is most likely negative.

Suggested Citation

  • Domínguez, Patricio & Grau, Nicolás & Vergara, Damián, 2022. "Combining discrimination diagnostics to identify sources of statistical discrimination," Economics Letters, Elsevier, vol. 212(C).
    • Handle: RePEc:eee:ecolet:v:212:y:2022:i:c:s0165176522000131
    DOI: 10.1016/j.econlet.2022.110294
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    References listed on IDEAS

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    Cited by:

    1. Neil Bhutta & Aurel Hizmo & Daniel R. Ringo, 2022. "How Much Does Racial Bias Affect Mortgage Lending? Evidence from Human and Algorithmic Credit Decisions," Finance and Economics Discussion Series 2022-067, Board of Governors of the Federal Reserve System (U.S.).
    2. Listo, Ariel & Muñoz, Ercio A. & Sansone, Dario, 2025. "Measuring the Sources of Taste-Based Discrimination Using List Experiments," IZA Discussion Papers 17976, IZA Network @ LISER.
    3. Patricio Dom'inguez & Nicol'as Grau & Dami'an Vergara, 2022. "Discrimination Against Immigrants in the Criminal Justice System: Evidence from Pretrial Detentions," Papers 2202.10685, arXiv.org.

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    Keywords

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    JEL classification:

    • C10 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - General
    • J10 - Labor and Demographic Economics - - Demographic Economics - - - General
    • J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing
    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law

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