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Outsourcing Recruitment as a Solution to Prevent Discrimination: A Correspondence Study

Author

Listed:
  • Berson, Clémence

    () (Banque de France)

  • Laouénan, Morgane

    () (CNRS)

  • Valat, Emmanuel

    () (University of Paris 2)

Abstract

Many studies have proven the existence of discriminatory behavior from employers according to the origin of applicants. However, little is known about how these behaviors can be prevented. In this work, we assess how organization of recruitment in large companies affects ethnic discrimination. We consider large multi-establishment companies and distinguish two types of recruitment organization: hiring made through a human resources (HR) service at a centralized level of the company and hiring made at only the level of the establishment concerned by the position, generally by managers in charge of recruitment. To conduct our research, we rely on data from a correspondence study conducted in 2016 by the Dares (French Ministry of Labor) in large companies, which shows the existence of ethnic discrimination in hiring. This experimentation allows us to gather precise and original information on the level at which applications were selected for each of the 1,500 tests carried out. Because access to a centralized HR service is potentially endogenous, we use an instrument to assess the causal effect: whether (or not) the establishment with the job offer belongs to a company that has developed a franchise network. Our results indicate that access to a centralized HR service in the selection of applications has an important effect on the level of discrimination: This type of recruitment organization results in a 0.29-point decrease in the probability that the applicant of presumed "French" origin is selected alone.

Suggested Citation

  • Berson, Clémence & Laouénan, Morgane & Valat, Emmanuel, 2019. "Outsourcing Recruitment as a Solution to Prevent Discrimination: A Correspondence Study," IZA Discussion Papers 12132, Institute of Labor Economics (IZA).
  • Handle: RePEc:iza:izadps:dp12132
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    References listed on IDEAS

    as
    1. Pierre-Philippe Combes & Bruno Decreuse & Morgane Laouénan & Alain Trannoy, 2016. "Customer Discrimination and Employment Outcomes: Theory and Evidence from the French Labor Market," Journal of Labor Economics, University of Chicago Press, vol. 34(1), pages 107-160.
    2. repec:sae:ilrrev:v:72:y:2019:i:1:p:223-252 is not listed on IDEAS
    3. Pascale Petit & Emmanuel Duguet & Yannick L’Horty, 2015. "Discrimination résidentielle et origine ethnique : une étude expérimentale sur les serveurs en Île-de-France," Economie & Prévision, La Documentation Française, vol. 0(1), pages 55-69.
    4. David Neumark & Judith Rich, 2019. "Do Field Experiments on Labor and Housing Markets Overstate Discrimination? A Re-examination of the Evidence," ILR Review, Cornell University, ILR School, vol. 72(1), pages 223-252, January.
    5. Baert, Stijn, 2017. "Hiring Discrimination: An Overview of (Almost) All Correspondence Experiments Since 2005," IZA Discussion Papers 10738, Institute of Labor Economics (IZA).
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    11. Carlsson, Magnus & Fumarco, Luca & Rooth, Dan-Olof, 2013. "Artifactual evidence of discrimination in correspondence studies? A replication of the Neumark method," POLIS Working Papers 172, Institute of Public Policy and Public Choice - POLIS.
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    More about this item

    Keywords

    North African origin; large firms; hiring discrimination; organization of human resources;

    JEL classification:

    • A13 - General Economics and Teaching - - General Economics - - - Relation of Economics to Social Values
    • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing
    • J78 - Labor and Demographic Economics - - Labor Discrimination - - - Public Policy (including comparable worth)
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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