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Testing for asymmetric employer learning and statistical discrimination

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  • Suqin Ge
  • Andrea Moro
  • Beibei Zhu

Abstract

We test if firms statistically discriminate workers based on race when employer learning is asymmetric. Using data from the NLSY79, we find evidence of asymmetric employer learning. In addition, employers statistically discriminate against non-college-educated black workers at time of hiring. We also find that employers directly observe most of the productivity of college graduates at hiring and learn very little over time about these workers.

Suggested Citation

  • Suqin Ge & Andrea Moro & Beibei Zhu, 2021. "Testing for asymmetric employer learning and statistical discrimination," Applied Economics, Taylor & Francis Journals, vol. 53(12), pages 1361-1377, March.
    • Handle: RePEc:taf:applec:v:53:y:2021:i:12:p:1361-1377
    DOI: 10.1080/00036846.2020.1830939
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    References listed on IDEAS

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    1. Joseph G. Altonji & Charles R. Pierret, 2001. "Employer Learning and Statistical Discrimination," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 116(1), pages 313-350.
    2. George A. Akerlof, 1970. "The Market for "Lemons": Quality Uncertainty and the Market Mechanism," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 84(3), pages 488-500.
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    Cited by:

    1. Lepage, Louis Pierre, 2021. "Endogenous learning, persistent employer biases, and discrimination," CLEF Working Paper Series 34, Canadian Labour Economics Forum (CLEF), University of Waterloo.

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    More about this item

    JEL classification:

    • J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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