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Racial Bias in the Manager-Employee Relationship: An Analysis of Quits, Dismissals, and Promotions at a Large Retail Firm

  • Laura Giuliano
  • David I. Levine
  • Jonathan Leonard

Using data from a large U.S. retail firm, we examine how racial matches between managers and their employees affect rates of employee quits, dismissals, and promotions. We exploit changes in management at hundreds of stores to estimate hazard models with store fixed effects that control for all unobserved differences across store locations. We find a general pattern of own-race bias in that employees usually have better outcomes when they are the same race as their manager. But we do find anomalies in this pattern, particularly when the manager-employee match violates traditional racial hierarchies (for example, nonwhites managing whites).

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File URL: http://jhr.uwpress.org/cgi/reprint/46/1/26
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Article provided by University of Wisconsin Press in its journal Journal of Human Resources.

Volume (Year): 46 (2011)
Issue (Month): 1 ()
Pages: 26-52

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Handle: RePEc:uwp:jhriss:v:46:y:2011:i:1:p:26-52
Contact details of provider: Web page: http://jhr.uwpress.org/

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  1. Timothy Bates, 1994. "Utilization of minority employees in small business: A comparison of nonminority and black-owned urban enterprises," The Review of Black Political Economy, Springer, vol. 23(1), pages 113-121, June.
  2. Laura Giuliano & David I. Levine & Jonathan Leonard, 2009. "Manager Race and the Race of New Hires," Journal of Labor Economics, University of Chicago Press, vol. 27(4), pages 589-631, October.
  3. Bentley W. MacLeod, 2003. "Optimal Contracting with Subjective Evaluation," American Economic Review, American Economic Association, vol. 93(1), pages 216-240, March.
  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. Kenneth R Troske & William J Carrington, 1996. "Interfirm Segregation and the Black/White Wage Gap," Working Papers 96-6, Center for Economic Studies, U.S. Census Bureau.
  6. Thomas S. Dee, 2005. "A Teacher Like Me: Does Race, Ethnicity, or Gender Matter?," American Economic Review, American Economic Association, vol. 95(2), pages 158-165, May.
  7. Michael A. Stoll & Steven Raphael & Harry J. Holzer, 2004. "Black job applicants and the hiring officer's race," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 57(2), pages 267-287, January.
  8. Joseph Price & Justin Wolfers, 2007. "Racial Discrimination Among NBA Referees," NBER Working Papers 13206, National Bureau of Economic Research, Inc.
  9. Christopher Avery & Susan Athey & Peter Zemsky, 2000. "Mentoring and Diversity," American Economic Review, American Economic Association, vol. 90(4), pages 765-786, September.
  10. Michael A. Stoll & Steven Raphael & Harry J. Holzer, 2004. "Black Job Applicants and the Hiring Officer's Race," ILR Review, Cornell University, ILR School, vol. 57(2), pages 267-287, January.
  11. Becker, Gary S., 1971. "The Economics of Discrimination," University of Chicago Press Economics Books, University of Chicago Press, edition 2, number 9780226041162.
  12. Jonathan S. Leonard & David I. Levine, 2006. "The Effect of Diversity on Turnover: A Large Case Study," ILR Review, Cornell University, ILR School, vol. 59(4), pages 547-572, July.
  13. Donohue, John J, III & Levitt, Steven D, 2001. "The Impact of Race on Policing and Arrests," Journal of Law and Economics, University of Chicago Press, vol. 44(2), pages 367-94, October.
  14. Anbarci, Nejat & Lee, Jungmin, 2008. "Speed Discounting and Racial Disparities: Evidence from Speeding Tickets in Boston," IZA Discussion Papers 3903, Institute for the Study of Labor (IZA).
  15. Lang, Kevin, 1986. "A Language Theory of Discrimination," The Quarterly Journal of Economics, MIT Press, vol. 101(2), pages 363-82, May.
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