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Disentangling qualitative and quantitative central bank influence

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  • Lamia E. Kandil

    () (Ofce,Sciences-po)

Abstract

This paper proposes a dynamic statistical-discrimination model of job assignment and promotion which takes into account the endogeneity of human-capital investment and where the employer’s prior beliefs are self-fulfilling in equilibrium. The model shows that the equilibrium results from standard statistical-discrimination models may change when we account for discrimination/self-selection in hiring via the employer’s beliefs about worker expected quit rates and ability. The model is estimated on the Egyptian labour market using a multivariate simulated maximum likelihood model, and the results confirm the model’s predictions. When women face significant adversity in hiring, those women who overcome this initial discrimination are as likely to be promoted as their male counterparts with similar characteristics. Classification-JEL :J16,J71

Suggested Citation

  • Lamia E. Kandil, 2015. "Disentangling qualitative and quantitative central bank influence," Documents de Travail de l'OFCE 2015-02, Observatoire Francais des Conjonctures Economiques (OFCE).
  • Handle: RePEc:fce:doctra:1502
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    File URL: http://www.ofce.sciences-po.fr/pdf/dtravail/WP2015-02.pdf
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    References listed on IDEAS

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    1. Ghada Barsoum, 2007. "Egypt Labor Market Panel Survey 2006: Report on Methodology and Data Collection," Working Papers 704, Economic Research Forum, revised 01 Jan 2007.
    2. Ragui Assaad, 2014. "Making sense of Arab labor markets: the enduring legacy of dualism," IZA Journal of Labor & Development, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 3(1), pages 1-25, December.
    3. David Blackaby & Alison L Booth & Jeff Frank, 2005. "Outside Offers And The Gender Pay Gap: Empirical Evidence From the UK Academic Labour Market," Economic Journal, Royal Economic Society, vol. 115(501), pages 81-107, February.
    4. Bulow, Jeremy I & Summers, Lawrence H, 1986. "A Theory of Dual Labor Markets with Application to Industrial Policy,Discrimination, and Keynesian Unemployment," Journal of Labor Economics, University of Chicago Press, vol. 4(3), pages 376-414, July.
    5. David Blackaby & Alison L Booth & Jeff Frank, 2005. "Outside Offers And The Gender Pay Gap: Empirical Evidence From the UK Academic Labour Market," Economic Journal, Royal Economic Society, vol. 115(501), pages 81-107, February.
    6. Yun, Myeong-Su, 1999. "Generalized Selection Bias and The Decomposition of Wage Differentials," IZA Discussion Papers 69, Institute of Labor Economics (IZA).
    7. Alan S. Blinder, 1973. "Wage Discrimination: Reduced Form and Structural Estimates," Journal of Human Resources, University of Wisconsin Press, vol. 8(4), pages 436-455.
    8. Heckman, James, 2013. "Sample selection bias as a specification error," Applied Econometrics, Publishing House "SINERGIA PRESS", vol. 31(3), pages 129-137.
    9. Phelps, Edmund S, 1972. "The Statistical Theory of Racism and Sexism," American Economic Review, American Economic Association, vol. 62(4), pages 659-661, September.
    10. Winter-Ebmer, Rudolf & Zweimuller, Josef, 1997. "Unequal Assignment and Unequal Promotion in Job Ladders," Journal of Labor Economics, University of Chicago Press, vol. 15(1), pages 43-71, January.
    11. Assaad, Ragui & Arntz, Melanie, 2005. "Constrained Geographical Mobility and Gendered Labor Market Outcomes Under Structural Adjustment: Evidence from Egypt," World Development, Elsevier, vol. 33(3), pages 431-454, March.
    12. John M. McDowell & Larry D. Singell Jr. & James P. Ziliak, 2001. "Gender and Promotion in the Economics Profession," ILR Review, Cornell University, ILR School, vol. 54(2), pages 224-244, January.
    13. Di Tommaso, Maria Laura, 1999. "A Trivariate Model of Participation, Fertility and Wages: The Italian Case," Cambridge Journal of Economics, Oxford University Press, vol. 23(5), pages 623-640, September.
    14. Fryer, Roland, 2007. "Belief Flipping in a Dynamic Model of Statistical Discrimination," Scholarly Articles 2955768, Harvard University Department of Economics.
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    More about this item

    Keywords

    efficient promotion; gender discrimination; prejudice;

    JEL classification:

    • J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination
    • J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing

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