capital labour and justice - discrimination Flashcards
what are the lost einstiens and what would the effect be?
if women, minorities and children from low income families were to invent at the same rate as white men from high income families, the rate of innovation in the united states would quaduple.
what is type 1 discrimination?
discrimination by relevant characteristics eg qualifications - disparities in otucomes are driven by disparities in observable characteristics
what is type 2 discrimination>
statisticial discrimination - sorting based on group averages on relevant characteristics. when an observable characteristic might be used as a proxy for unobservable characterstics if statistically correlated
what is type 3 discrimination?
preference based discrimination. when decision makers care about observable characteristic in and of itself
why does statistical discrimination occur?
bayesians use conditional probability to form judgements. for example, we typically only screen women for breast cancer even though some men get breast cancer
if gender is correlated with unobserved outcomes like productivity, firms who wish to maximise profits will statistically discriminate. this relationship does not have to be causal. however perceived correlations can often be inaccurate and self reinforcing. even if these correlations were accurate, it could still have negative impact to individuals and society
is there evidence of discrimination in markets?
buyers were less likely to make an offer for ipod nanos from black sellers and more lower offers if they did
arab buyers and sellers also face discrimination in online market for used cars in israel
is there evidence of discrimination in employment?
9.7% of CVs with a white sounding name elicted a callback, relative to 6.5% black sounding names. however this could also be linked to social class as there is considerable variation in callback rates across names within race
is there evidence of discrimination in crime?
black drivers are 40% more likely to be stopped than white drivers controlling for age gender and location. but this could be black drivers were commiting more offences. to account for this , using data on street lighting at night, they find light is associated with a 15% increase in the odds of blakc driver being stopped
what is beckers neoclassical model?
there are two groups who are both equally productive
discrimination gives rise to two seperate demand curves
the biased firms will employ workers from the high wage group at L1 with wage W1 and face lower profits or employ workers from disadvantaged group at L1 with wage W4 and increase profits. discrimination imposes a cost on the firm as well as the disadvantages group via lower employment/wages
the unbiased firms employ workers from either group at L4 with wage W4. this imploes that if there is a sufficient number of unbiased employers, over time unbiased employers will drive biased employers out of business via lower prices due to increase in output
what are the critisms of beckers model?
the threat of future statistical discrimination can lead to lower levels of investment in human capital which would ultimately decrease wages
if biased employers exist, and job search is costly, then black job seekers will have lower reservation wages. this leads them to accept lower offers. unbiased employers will therefore offer black job candidates lower wages aswell
as small amounts of bias can lead to segregation, and this leads to insular social networks. this slows the rate at which employers update inaccurate group sterotypes
cognitive biases mean humans recall eg population distributions, in a way that exagerates true differences across groups
why might monitoring decisions hurt black workers?
if firms scrutinise black workers more closely, a larger share of low productivity workers will become unemployed. as a result, the black unemployed pool gets churned and will be weaker on average than the white unemployment pool. employers, statistically discriminate and use race as an indicator of expected productivity. this makes monitoring black workers optimal for firms and discrimination becomes a self fufilling prophecy
what is ban the box?
in the US, BTB stop employers from asking a job applicant about their criminal record unitl late in the hiring process. the reason is that applicants with criminal records are less likely to get callbacks from employers, holding all other things constant
what was the impact of the ban the box intervention?
research shows that BTB did not help people with criminal records get jobs
when employers cannot ask about criminal records, they increase racial statistical discrimination. as a result, employment of young low skilled black men fell
what is postive action?
positive actio is a set of policies to that seek to benefit groups that have been historically discriminated and are unrepresented in eg education and employment. in the UK, positive discrimination is illegal under the equality act 2010. however positve action is not.
what is the impact of affirmative action?
affirmative action has sucessfully increased black employment
effects seem to persist even have policies end as employers increase investment in recruiting and screening
workplace metoring having more minority employees in senior positions increases type based mentoring and enables increased promotion of future minority candidates
this can lead to minority groups to investing in human capital as potential benefits have increased
affirmative action does not seem to cause productivity loss by not hiring . this could be that quotas increases number and quality of applicants who apply
