American Economic Journal:
Applied Economics
ISSN 1945-7782 (Print) | ISSN 1945-7790 (Online)
Experience-Based Discrimination
American Economic Journal: Applied Economics
vol. 16,
no. 4, October 2024
(pp. 288–321)
Abstract
I study discrimination arising from individual experiences of employers with worker groups. I present a model in which employers are uncertain about the productivity of one of two groups and learn through hiring. Positive experiences lead to positive biases, which correct themselves by leading to more hiring and learning. Negative experiences decrease hiring and learning, preserving negative biases, which can cause persistent discrimination. The model explains prejudice as incorrect statistical discrimination and generates novel predictions and policy implications. I then illustrate experience-based discrimination in an experimental labor market, finding support for key model predictions.Citation
Lepage, Louis-Pierre. 2024. "Experience-Based Discrimination." American Economic Journal: Applied Economics, 16 (4): 288–321. DOI: 10.1257/app.20220466Additional Materials
JEL Classification
- D83 Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
- J23 Labor Demand
- J24 Human Capital; Skills; Occupational Choice; Labor Productivity
- J31 Wage Level and Structure; Wage Differentials
- J71 Labor Discrimination
- M51 Personnel Economics: Firm Employment Decisions; Promotions
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