Title

Racial discrimination in the lab: Evidence of statistical and taste-based discrimination

Document Type

Article

Publication Date

2020

Department/School

Accounting and Finance

Publication Title

Journal of Behavioral and Experimental Economics

Abstract

© 2020 Elsevier Inc. Using a lab experiment that simulates a labor market, we investigate racial discrimination for employee selection. We find discrimination against Blacks persists even when information about candidates’ past performance/abilities is known. The experiment design allows us to observe within-subject variation in discrimination based on different available information about candidates, which helps distinguish between statistical and taste-based discrimination. We find evidence of discrimination by Non-Blacks against Blacks whenever race is salient. Some hiring discrimination against Blacks is statistical, since it is based on distrust of applicants’ self-reported abilities, and is also present in the discrimination of Blacks against their own group. But discrimination by Non-Blacks against Blacks is likely taste-based as it endures when more accurate information about abilities is known and even when such discrimination is costly. We suggest that the institutional and social climate may shape the prevalence of this type of discrimination.

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