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Are Firms That Discriminate More Likely to Go Out of Business?
Sociological science, 2016-09, Vol.3 (36), p.849-859
[Peer Reviewed Journal]
Copyright Society for Sociological Science Sep 2016 ;ISSN: 2330-6696 ;EISSN: 2330-6696 ;DOI: 10.15195/v3.a36
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Title:
Are Firms That Discriminate More Likely to Go Out of Business?
Author:
Pager, Devah
Subjects:
Audit Study
;
Audits
;
Discrimination
;
Economic theory
;
Firm Survival
;
Gary Becker
;
Racial discrimination
;
Studies
Is Part Of:
Sociological science, 2016-09, Vol.3 (36), p.849-859
Description:
Economic theory has long maintained that employers pay a price for engaging in racial discrimination. According to Gary Becker's seminal work on this topic and the rich literature that followed, racial preferences unrelated to productivity are costly and, in a competitive market, should drive discriminatory employers out of business. Though a dominant theoretical proposition in the field of economics, this argument has never before been subjected to direct empirical scrutiny. This research pairs an experimental audit study of racial discrimination in employment with an employer database capturing information on establishment survival, examining the relationship between observed discrimination and firm longevity. Results suggest that employers who engage in hiring discrimination are less likely to remain in business six years later.
Publisher:
Stanford: Society for Sociological Science
Language:
English
Identifier:
ISSN: 2330-6696
EISSN: 2330-6696
DOI: 10.15195/v3.a36
Source:
ProQuest Central
DOAJ Directory of Open Access Journals
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