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The Law and Economics of Antidiscrimination Law

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  • John J. Donohue III

Abstract

This essay provides an overview of the central theoretical law and economics insights concerning antidiscrimination law across a variety of contexts including discrimination in labor markets, housing markets, consumer purchases, and policing. The different models of discrimination based on animus, statistical discrimination, and cartel exploitation are analyzed for both race and sex discrimination. I explore the theoretical arguments for prohibiting private discriminatory conduct and illustrates the tensions that exist between concerns for liberty and equality. I also discuss the critical point that one cannot automatically attribute observed disparities in various economic or social outcomes to discrimination, and illustrate the complexities in establishing the existence of discrimination. The major empirical findings showing the effectiveness of federal law in the first decade after passage of the 1964 Civil Rights Act are contrasted with the generally less optimistic findings from subsequent antidiscrimination interventions.

Suggested Citation

  • John J. Donohue III, 2005. "The Law and Economics of Antidiscrimination Law," NBER Working Papers 11631, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:11631
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    Cited by:

    1. de la Rica, Sara & Dolado, Juan J. & García-Peñalosa, Cecilia, 2008. "On Gender Gaps and Self-fulfilling Expectations: Theory, Policies and Some Empirical Evidence," IZA Discussion Papers 3553, Institute for the Study of Labor (IZA).
    2. Christine Jolls & J.J. Prescott, 2004. "Disaggregating Employment Protection: The Case of Disability Discrimination," NBER Working Papers 10740, National Bureau of Economic Research, Inc.

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    JEL classification:

    • H - Public Economics
    • J - Labor and Demographic Economics
    • K - Law and Economics

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