Article ID Journal Published Year Pages File Type
7372181 Labour Economics 2014 9 Pages PDF
Abstract
In a random search environment with two racial groups each composed of identical numbers of high and low productivity workers, firms use an imperfect screening device (interviews) to control hiring. If inconclusive interviews lead firms to hire majority workers but not minority workers, then the unemployment pool for majority workers is of higher average quality. This can justify the initial hiring choices. Color-blind hiring always eliminates racial disparities but is not necessarily beneficial; in the USA it would improve welfare with only a brief small increase in white unemployment.
Related Topics
Social Sciences and Humanities Economics, Econometrics and Finance Economics and Econometrics
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