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Customer Discrimination

Author

Listed:
  • Jonathan S. Leonard

    (University of California, Berkeley)

  • David I. Levine

    (University of California, Berkeley)

  • Laura Giuliano

    (University of Miami)

Abstract

We test for customer discrimination with data from more than 800 retail stores employing over 70,000 individuals matched to census data on the demographics of each store's community. While our tests detect some increase in sales when the workforce more closely resembles potential customers, the effects we find are modest in magnitude. Customer discrimination is neither strong nor pervasive. We find little payoff to matching employee demographics to those of potential customers except when the customers do not speak English. © 2010 The President and Fellows of Harvard College and the Massachusetts Institute of Technology.

Suggested Citation

  • Jonathan S. Leonard & David I. Levine & Laura Giuliano, 2010. "Customer Discrimination," The Review of Economics and Statistics, MIT Press, vol. 92(3), pages 670-678, August.
    • Handle: RePEc:tpr:restat:v:92:y:2010:i:3:p:670-678
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    Citations

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    Cited by:

    1. Ryan C. McDevitt & James W. Roberts, 2014. "Market structure and gender disparity in health care: preferences, competition, and quality of care," RAND Journal of Economics, RAND Corporation, vol. 45(1), pages 116-139, March.
    2. Tan, Eugene & Zeida, Teegawende H., 2024. "Consumer demand and credit supply as barriers to growth for Black-owned startups," Journal of Monetary Economics, Elsevier, vol. 143(C).
    3. Morgane Laouénan, 2013. "Un cas particulier de discrimination sur le marché du travail : l'accès aux emplois en contact avec le public," Économie et Statistique, Programme National Persée, vol. 464(1), pages 35-58.
    4. Hoogendoorn, Sander M. & van Praag, Mirjam C., 2012. "Ethnic Diversity and Team Performance: A Field Experiment," IZA Discussion Papers 6731, Institute of Labor Economics (IZA).
    5. Pierre-Philippe Combes & Bruno Decreuse & Morgane Laouénan & Alain Trannoy, 2016. "Customer Discrimination and Employment Outcomes: Theory and Evidence from the French Labor Market," Journal of Labor Economics, University of Chicago Press, vol. 34(1), pages 107-160.
    6. Laouénan, Morgane, 2017. "‘Hate at First Sight’: Evidence of consumer discrimination against African-Americans in the US," Labour Economics, Elsevier, vol. 46(C), pages 94-109.
    7. Matthew Parrett, 2011. "Customer Discrimination in Restaurants: Dining Frequency Matters," Journal of Labor Research, Springer, vol. 32(2), pages 87-112, June.
    8. Venkat Kuppuswamy & Peter Younkin, 2020. "Testing the Theory of Consumer Discrimination as an Explanation for the Lack of Minority Hiring in Hollywood Films," Management Science, INFORMS, vol. 66(3), pages 1227-1247, March.
    9. Pierre-Philippe Combes & Bruno Decreuse & Morgane Laouénan & Alain Trannoy, 2016. "Customer Discrimination and Employment Outcomes: Theory and Evidence from the French Labor Market," Journal of Labor Economics, University of Chicago Press, vol. 34(1), pages 107-160.
    10. Kapoor, Sacha & Magesan, Arvind, 2019. "Having it easy: Discrimination and specialization in the workplace," Journal of Economic Behavior & Organization, Elsevier, vol. 166(C), pages 153-173.
    11. Amegashie, J．Atsu, 2023. "Market segregation in the presence of customer discrimination," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 105(C).
    12. Rinne, Ulf & Sonnabend, Hendrik & Wolters, Leonie, 2023. "Customer Discrimination and Ethnic Team Composition," IZA Discussion Papers 16315, Institute of Labor Economics (IZA).
    13. Laouénan, Morgane, 2014. "'Can't Get Enough': Prejudice, Contact Jobs and the Racial Wage Gap in the US," IZA Discussion Papers 8006, Institute of Labor Economics (IZA).
    14. Köllő, János & Boza, István & Ilyés, Virág & Kőműves, Zsófia & Mark, Lili Katalin, 2023. "How Do Firms Deal with the Risks of Employing Ex-prisoners?," IZA Discussion Papers 16645, Institute of Labor Economics (IZA).
    15. Pramod Kumar Sur & Masaru Sasaki, 2020. "Measuring Customer Discrimination: Evidence From the Professional Cricket League in India," Journal of Sports Economics, , vol. 21(4), pages 420-448, May.
    16. Tsuru, Tsuyoshi & 都留, 康 & ツル, ツヨシ & Owan, Hideo & 大湾, 秀雄 & オオワン, ヒデオ & Uehara, Katsuhito & 上原, 克仁, 2010. "Price Discrimination and Social Network : Evidence from North American Auto Dealership Transaction Data," Discussion Paper Series a529, Institute of Economic Research, Hitotsubashi University.
    17. J. Atsu Amegashie, 2023. "Market Segregation in the Presence of Customer Discrimination," CESifo Working Paper Series 10453, CESifo.
    18. Elert, Niklas & Lundin, Erik, 2020. "Gender and Climate Action," Working Paper Series 1332, Research Institute of Industrial Economics, revised 18 Feb 2022.
    19. Younkin, Peter & Kuppuswamy, Venkat, 2019. "Discounted: The effect of founder race on the price of new products," Journal of Business Venturing, Elsevier, vol. 34(2), pages 389-412.
    20. Carsten Creutzburg & Wolfgang Maennig & Steffen Q. Mueller, 2024. "From bias to bliss: Racial preferences and worker productivity in tennis," Working Papers 075, Chair for Economic Policy, University of Hamburg.
    21. Boyd-Swan, Casey & Herbst, Chris M., 2017. "Racial and Ethnic Discrimination in the Labor Market for Child Care Teachers," IZA Discussion Papers 11140, Institute of Labor Economics (IZA).
    22. Ahmed, Ali & Hammarstedt, Mats, 2018. "Customer Discrimination in the Fast Food Market? Experimental Evidence from a Swedish University Campus," Working Paper Series 1232, Research Institute of Industrial Economics.
    23. repec:hal:spmain:info:hdl:2441/2tlvpn71ve888pnch88db9g683 is not listed on IDEAS

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