Equal-treatment policy in a random search model with taste discrimination

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2010
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Zusammenfassung

We consider a search model of the labor market with two types of equally productive workers and two types of firms, discriminators and non-discriminators. Without policy intervention, there is wage dispersion between and within the two worker groups, but all wage differences become negligible when the taste for discrimination is small. We analyze the effect of an equal-pay policy, both in combination with affirmative action and without. When equal opportunity of hiring cannot be enforced, wage dispersion increases and wages for minority workers fall substantially relative to laissez faire. Sometimes also the wage gap between worker groups widens in response to the policy.

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330 Wirtschaft
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Search model, wage dispersion, discrimination, equal-pay policy
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ISO 690KAAS, Leo, Jun LU, 2010. Equal-treatment policy in a random search model with taste discrimination. In: Labour Economics. 2010, 17(4), pp. 699-709. ISSN 0927-5371. eISSN 1879-1034. Available under: doi: 10.1016/j.labeco.2010.01.002
BibTex
@article{Kaas2010Equal-12691,
  year={2010},
  doi={10.1016/j.labeco.2010.01.002},
  title={Equal-treatment policy in a random search model with taste discrimination},
  number={4},
  volume={17},
  issn={0927-5371},
  journal={Labour Economics},
  pages={699--709},
  author={Kaas, Leo and Lu, Jun}
}
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