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Hiring a Homosexual, Taking a Risk? A Lab Experiment on Employment Discrimination and Risk Aversion

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  • Baert, Stijn

Abstract

We investigate risk aversion as a driver of labour market discrimination against homosexual men. We show that more hiring discrimination by more risk-averse employers is consistent with taste-based and statistical discrimination. To test this hypothesis we conduct a scenario experiment in which experimental employers make a hiring decision concerning a heterosexual or homosexual job candidate. In addition, participants are surveyed on their risk aversion and other characteristics that might correlate with this risk aversion. Analysis of the (post-)experimental data confirms our hypothesis. The probability of a beneficial hiring decision for homosexual candidates decreases by 31.7% when employers are a standard deviation more risk-averse.

Suggested Citation

  • Baert, Stijn, 2017. "Hiring a Homosexual, Taking a Risk? A Lab Experiment on Employment Discrimination and Risk Aversion," GLO Discussion Paper Series 2, Global Labor Organization (GLO).
  • Handle: RePEc:zbw:glodps:2
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    References listed on IDEAS

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    More about this item

    Keywords

    Hiring discrimination; statistical discrimination; sexual orientation; scenario experiment; risk aversion;

    JEL classification:

    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • J15 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Minorities, Races, Indigenous Peoples, and Immigrants; Non-labor Discrimination
    • J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing

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