Ethnic Discrimination in Germany's Labour Market : A Field Experiment

Abstract

This paper studies ethnic discrimination in Germany's labour market with a correspondence test. We send two similar applications to each of 528 advertisements for student internships, one with a Turkish-sounding and one with a German-sounding name. A German name raises the average probability of a callback by about 14%. Differential treatment is particularly strong and significant in smaller firms at which the applicant with the German name receives 24% more callbacks. Discrimination disappears when we restrict our sample to applications including reference letters which contain favourable information about the candidate's personality. We interpret this finding as evidence for statistical discrimination.