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Is Labour Market Discrimination against Ethnic Minorities Better Explained by Taste or Statistics? A Systematic Review of the Empirical Evidence

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  • Lippens, Louis

    (Ghent University)

  • Baert, Stijn

    (Ghent University)

  • Ghekiere, Abel

    (Free University of Brussels)

  • Verhaeghe, Pieter-Paul

    (Free University of Brussels)

  • Derous, Eva

    (Ghent University)

Abstract

Scholars have gone to great lengths to chart the incidence of ethnic labour market discrimination. To effectively mitigate this discrimination, however, we need to understand its underlying mechanisms because different mechanisms lead to different counteracting measures. To this end, we reviewed the recent literature that confronts the seminal theories of taste-based and statistical discrimination against the empirical reality. First, we observed that the measurement operationalisation of the mechanisms varied greatly between studies, necessitating the development of a measurement standard. Second, we found that 20 out of 30 studies examining taste-based discrimination and 18 out of 34 studies assessing statistical discrimination produced supportive evidence for said mechanisms. However, (field) experimental research, which predominantly focuses on hiring outcomes, yielded more evidence in favour of taste-based vis-à-vis statistical discrimination, suggesting that the taste-based mechanism might better explain ethnic discrimination in hiring.

Suggested Citation

  • Lippens, Louis & Baert, Stijn & Ghekiere, Abel & Verhaeghe, Pieter-Paul & Derous, Eva, 2020. "Is Labour Market Discrimination against Ethnic Minorities Better Explained by Taste or Statistics? A Systematic Review of the Empirical Evidence," IZA Discussion Papers 13523, Institute of Labor Economics (IZA).
  • Handle: RePEc:iza:izadps:dp13523
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    References listed on IDEAS

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    Cited by:

    1. Ayaita, Adam, 2021. "Labor Market Discrimination and Statistical Differences in Unobserved Characteristics of Applicants," EconStor Preprints 236615, ZBW - Leibniz Information Centre for Economics.
    2. Lippens, Louis & Baert, Stijn & Derous, Eva, 2021. "Loss aversion in taste-based employee discrimination: Evidence from a choice experiment," Economics Letters, Elsevier, vol. 208(C).

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    More about this item

    Keywords

    taste-based discrimination; statistical discrimination; ethnicity; race; labour market; systematic review;
    All these keywords.

    JEL classification:

    • J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing
    • J15 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Minorities, Races, Indigenous Peoples, and Immigrants; Non-labor Discrimination
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand

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