New results on the economics of discrimination

There is a new and excellent paper by Uri Gneezy, John List, and Michael K. Price (gated version here, $5 charge for non-university readers), here is one good excerpt:

…in the automobile repair market, we find that the disabled receive offers that are 30 percent higher than the offers received by the abled.  One possible reason for this disparate treatment is search cost differences — one would expect search to be more costly for the disabled.  Under this scenario, such agents might search less and repairmen might capitalize on that fact.  To test this conjecture, and identify the underlying nature of discrimination, we employ a complementary field experiment where during the offer process all agents note that “I am getting a few price quotes.”  Upon having our agents make this simple statement, we find that offer distributions become isomorphic.

The paper has much more of interest.


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