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Statistical Discrimination and Affirmative Action in the Lab

Author

Listed:
  • Ahrash Dianat

    (University of Essex)

  • Federico Echenique

    (Caltech)

  • Leeat Yariv

    (Princeton University)

Abstract

We present results from laboratory experiments studying statistical discrimination and affirmative action. We induce statistical discrimination in simple labor-market interactions between firms and workers. We then introduce affirmative-action policies that vary in the size and duration of a subsidy that firms receive for hiring discriminated against workers. These different affirmative-action policies have nearly the same effect, and practically eliminate discriminatory hiring practices. However, once lifted, few positive effects remain and discrimination reverts to its initial levels. One exception is lengthy affirmative-action policies, which exhibit somewhat longer-lived effects. Stickiness of beliefs, which we elicit, helps explain the observed outcomes.

Suggested Citation

  • Ahrash Dianat & Federico Echenique & Leeat Yariv, 2021. "Statistical Discrimination and Affirmative Action in the Lab," Working Papers 2020-46, Princeton University. Economics Department..
    • Handle: RePEc:pri:econom:2020-46
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    2. José J. Domínguez, 2021. "The Effectiveness of Committee Quotas; The Role of Group Dynamics," ThE Papers 21/12, Department of Economic Theory and Economic History of the University of Granada..
    3. Dustan, Andrew & Koutout, Kristine & Leo, Greg, 2022. "Second-order beliefs and gender," Journal of Economic Behavior & Organization, Elsevier, vol. 200(C), pages 752-781.
    4. Domínguez, José J., 2023. "Diversified committees in hiring processes: Lab evidence on group dynamics," Journal of Economic Psychology, Elsevier, vol. 97(C).
    5. José J. Domínguez & Natalia Montinari, 2021. "Gender Quotas and Task Assignment in Organizations," ThE Papers 21/13, Department of Economic Theory and Economic History of the University of Granada..
    6. Lepage, Louis Pierre, 2020. "Endogenous learning and the persistence of employer biases in the labor market," CLEF Working Paper Series 24, Canadian Labour Economics Forum (CLEF), University of Waterloo.

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    More about this item

    Keywords

    Statistical Discrimination; Affirmative Action; Experiments;
    All these keywords.

    JEL classification:

    • J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing
    • D04 - Microeconomics - - General - - - Microeconomic Policy: Formulation; Implementation; Evaluation
    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior

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