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Search, Bargaining and Employer Discrimination

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  • Rosén, Åsa

    (SOFI)

Abstract

This paper analyses Becker´s (1971) theory of employer discrimination within a search and wage-bargaining setting. Discriminatory firms pay workers who are discriminated against less, and apply stricter hiring-criteria to these workers. It is shown that the highest profits are realized by firms with a positive discrimination coefficient. Moreover, once ownership and control are separated, both highest profits and highest utility may be realized by firms with a positive discrimination coefficient. Thus, market forces, like entry and/or takeovers do not ensure that wage differentials due to employer discrimination will disappear.

Suggested Citation

  • Rosén, Åsa, 1998. "Search, Bargaining and Employer Discrimination," Working Paper Series 1998:13, Uppsala University, Department of Economics.
  • Handle: RePEc:hhs:uunewp:1998_013
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    References listed on IDEAS

    as
    1. Audra J. Bowlus & Zvi Eckstein, 2002. "Discrimination and Skill Differences in an Equilibrium Search Model," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 43(4), pages 1309-1345, November.
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    More about this item

    Keywords

    Search; discrimination;

    JEL classification:

    • J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing

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