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Don't demotivate, discriminate

Author

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  • Jurjen J.A. Kamphorst

    (Erasmus University Rotterdam)

  • Otto H. Swank

    (Erasmus University Rotterdam)

Abstract

This discussion paper led to a publication in the American Economic Journal: Microeconomics . This paper offers a new theory of discrimination in the workplace. We consider a manager who has to assign two tasks to two employees. The manager has superior information about the employees' abilities. We show that besides an equilibrium where the manager does not discriminate, equilibria exist where the manager discriminates in favor of the employee whom the employees expect to be favored. The manager, who has no taste for discrimination, discriminates in order to avoid demotivating the 'favorite'. We show that the non-discriminatory equilibrium is unstable. Yet the manager would prefer to commit not to discriminate.

Suggested Citation

  • Jurjen J.A. Kamphorst & Otto H. Swank, 2014. "Don't demotivate, discriminate," Tinbergen Institute Discussion Papers 14-017/VII, Tinbergen Institute.
    • Handle: RePEc:tin:wpaper:20140017
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    References listed on IDEAS

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    Cited by:

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    2. Anja Prummer, "undated". "Discrimination in Promotion," Working Papers 905, Queen Mary University of London, School of Economics and Finance.
    3. Sémirat, S., 2016. "Vertical conflict of interest and horizontal inequities," Working Papers 2016-06, Grenoble Applied Economics Laboratory (GAEL).
    4. Stéphan Sémirat, 2019. "Strategic information transmission despite conflict," International Journal of Game Theory, Springer;Game Theory Society, vol. 48(3), pages 921-956, September.
    5. Fabio Berton & Stefano Dughera & Andrea Ricci, 2019. "Unions and Firms' Investments. A Unified View," LABORatorio R. Revelli Working Papers Series 168, LABORatorio R. Revelli, Centre for Employment Studies.
    6. Eriksson, Tor & Smith, Nina & Smith, Valdemar, 2017. "Gender Stereotyping and Self-Stereotyping Attitudes: A Large Field Study of Managers," IZA Discussion Papers 10932, Institute of Labor Economics (IZA).
    7. Dewan, Torun & Wolton, Stephane, 2019. "A Political Economy of Social Discrimination," MPRA Paper 94394, University Library of Munich, Germany.
    8. Lagerlöf, Johan N.M., 2020. "Strategic gains from discrimination," European Economic Review, Elsevier, vol. 122(C).
    9. Sémirat, S., 2015. "Complementarity exacerbates discrimination," Working Papers 2015-12, Grenoble Applied Economics Laboratory (GAEL).

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    More about this item

    Keywords

    discrimination; confidence management; Bayesian games;
    All these keywords.

    JEL classification:

    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing
    • M51 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Firm Employment Decisions; Promotions
    • M54 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Labor Management

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