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Labor Mobility and Racial Discrimination

Listed author(s):
  • Pierre Deschamps

    (Département d'économie)

  • José de Sousa

    (Université Panthéon-Sorbonne - Paris I)

This paper assesses the impact of labor mobility on racial discrimination. We present an equilibrium search model that reveals an inverted U-shaped relationship between labor mobility and race-based wage differentials. We explore this relationship empirically with an exogenous mobility shock on the European soccer labor market. The Bosman ruling by the European Court of Justice in 1995 lifted restrictions on soccer player mobility. Using a panel of all clubs in the English first division from 1981 to 2008, we compare the pre- and post-Bosman ruling market to identify the causal effect of intensified mobility on race-based wage differentials. Consistent with a taste-based explanation, we find evidence that increasing labor market mobility decreases racial discrimination.

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File URL: http://spire.sciencespo.fr/hdl:/2441/6ftmcu468j8a49bft2hrpi6uql/resources/wp35-desousa-deschamps-liepp.pdf
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Paper provided by Sciences Po in its series Sciences Po publications with number 35.

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Date of creation: Dec 2014
Handle: RePEc:spo:wpmain:info:hdl:2441/6ftmcu468j8a49bft2hrpi6uql
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  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.
  2. Stijn Baert & Bart Cockx & Niels Gheyle & Cora Vandamme, 2015. "Is There Less Discrimination in Occupations Where Recruitment Is Difficult?," ILR Review, Cornell University, ILR School, vol. 68(3), pages 467-500, May.
  3. Ignacio Palacios-Huerta, 2014. "Beautiful Game Theory: How Soccer Can Help Economics," Economics Books, Princeton University Press, edition 1, number 10260.
  4. Kerwin Kofi Charles & Jonathan Guryan, 2011. "Studying Discrimination: Fundamental Challenges and Recent Progress," Annual Review of Economics, Annual Reviews, vol. 3(1), pages 479-511, September.
  5. Dale T. Mortensen, 1988. "Equilibrium Wage Distrihutions: A Synthesis," Discussion Papers 811, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
  6. Bowlus, Audra J & Kiefer, Nicholas M & Neumann, George R, 2001. "Equilibrium Search Models and the Transition from School to Work," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 42(2), pages 317-343, May.
  7. Stefan Szymanski, 2000. "A Market Test for Discrimination in the English Professional Soccer Leagues," Journal of Political Economy, University of Chicago Press, vol. 108(3), pages 590-603, June.
  8. Jeff Biddle & Daniel Hamermesh, 2013. "Wage discrimination over the business cycle," IZA Journal of Labor Policy, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 2(1), pages 1-19, December.
  9. David Roodman, 2009. "A Note on the Theme of Too Many Instruments," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 71(1), pages 135-158, February.
  10. John J. Binder & Murray Findlay, 2012. "The Effects of the Bosman Ruling on National and Club Teams in Europe," Journal of Sports Economics, , vol. 13(2), pages 107-129, April.
  11. Black, Dan A, 1995. "Discrimination in an Equilibrium Search Model," Journal of Labor Economics, University of Chicago Press, vol. 13(2), pages 309-333, April.
  12. Marianne Bertrand & Sendhil Mullainathan, 2004. "Are Emily and Greg More Employable Than Lakisha and Jamal? A Field Experiment on Labor Market Discrimination," American Economic Review, American Economic Association, vol. 94(4), pages 991-1013, September.
  13. Henrik Jacobsen Kleven & Camille Landais & Emmanuel Saez, 2013. "Taxation and International Migration of Superstars: Evidence from the European Football Market," American Economic Review, American Economic Association, vol. 103(5), pages 1892-1924, August.
  14. Wayne K. Talley & James Peoples, 2001. "Black-White Earnings Differentials: Privatization versus Deregulation," American Economic Review, American Economic Association, vol. 91(2), pages 164-168, May.
  15. Burdett, Kenneth & Mortensen, Dale T, 1998. "Wage Differentials, Employer Size, and Unemployment," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 39(2), pages 257-273, May.
  16. Kevin Lang & Jee-Yeon K. Lehmann, 2012. "Racial Discrimination in the Labor Market: Theory and Empirics," Journal of Economic Literature, American Economic Association, vol. 50(4), pages 959-1006, December.
  17. Heywood, John S & Peoples, James H, Jr, 1994. "Deregulation and the Prevalence of Black Truck Drivers," Journal of Law and Economics, University of Chicago Press, vol. 37(1), pages 133-155, April.
  18. Manuel Arellano & Stephen Bond, 1991. "Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations," Review of Economic Studies, Oxford University Press, vol. 58(2), pages 277-297.
  19. Lawrence M. Kahn, 2000. "The Sports Business as a Labor Market Laboratory," Journal of Economic Perspectives, American Economic Association, vol. 14(3), pages 75-94, Summer.
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