Statistical discrimination, employer learning, and employment gap by race and education

Seik Kim, Hwa Ryung Lee

Research output: Contribution to journalArticlepeer-review

1 Citation (Scopus)

Abstract

Tests of statistical discrimination require evaluation records provided by employers or variables that employers do not observe directly but are observed by researchers. As such variables are difficult to obtain, this paper develops a strategy that uses variables available in usual data sets. This paper derives testable implications for statistical discrimination by exploiting the heterogeneity in employer learning processes. Evidence from analysis using the March Current Population Survey for 1971-2016 is consistent with the theoretical predictions. The empirical findings are not explained by alternative hypotheses, such as human capital theory, taste-based discrimination, or search and matching models.

Original languageEnglish
Pages (from-to)5-27
Number of pages23
JournalKorean Economic Review
Volume36
Issue number1
Publication statusPublished - 2020

Bibliographical note

Funding Information:
The authors have benefited from helpful comments made by Joseph Altonji, Yoram Barzel, Byung-hill Jun, Fabian Lange, Shelly Lundberg, two anonymous reviewers, and seminar participants at the annual meetings of the Society of Labor Economists, European Association of Labor Economists, Population Association of America, European Society for Population Economics, Society for the Study of Economic Inequality, Academia Sinica, Korea Institute of Public Finance, Korea University, Sogang University, University of Zurich, University of Washington (UW), and the UW West Coast Poverty Center (WCPC). The authors gratefully acknowledge support from the WCPC through the Emerging Poverty Scholar Small Grant. This work was supported by a Korea University Grant (K1509061).

Funding Information:
* The authors have benefited from helpful comments made by Joseph Altonji, Yoram Barzel, Byung-hill Jun, Fabian Lange, Shelly Lundberg, two anonymous reviewers, and seminar participants at the annual meetings of the Society of Labor Economists, European Association of Labor Economists, Population Association of America, European Society for Population Economics, Society for the Study of Economic Inequality, Academia Sinica, Korea Institute of Public Finance, Korea University, Sogang University, University of Zurich, University of Washington (UW), and the UW West Coast Poverty Center (WCPC). The authors gratefully acknowledge support from the WCPC through the Emerging Poverty Scholar Small Grant. This work was supported by a Korea University Grant(K1509061). ** First Author, Associate Professor, Department of Economics, Korea University, 145 Anam-Ro, Seongbuk-Gu,Seoul02841,Korea.Phone:82-2-3290-5135.E-mail:seikkim@korea.ac.kr. *** Corresponding Author, Fellow, Korea Development Institute, 263 Namsejong-Ro, Sejong 30149,Korea.Phone:82-44-550-4101.E-mail:hwaryung.lee@kdi.re.kr.

Publisher Copyright:
© 2020, Korean Economic Association. All rights reserved.

Keywords

  • Employer Learning
  • Statistical Discrimination
  • Unemployment Rate

ASJC Scopus subject areas

  • Economics, Econometrics and Finance(all)

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