A Characterisation of ‘Phelpsian’ Statistical Discrimination

A-Tier
Journal: Economic Journal
Year: 2021
Volume: 131
Issue: 637
Pages: 2018-2032

Authors (2)

Christopher P Chambers (not in RePEc) Federico Echenique (University of California-Berke...)

Score contribution per author:

2.011 = (α=2.01 / 2 authors) × 2.0x A-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

We establish that a type of statistical discrimination—that based on informativeness of signals about workers’ skills and the ability appropriately to match workers to tasks—is possible if and only if it is impossible uniquely to identify the signal structure observed by an employer from a realised empirical distribution of skills. The impossibility of statistical discrimination is shown to be equivalent to the existence of a fair, skill-dependent, remuneration for workers. Finally, we connect the statistical discrimination literature to Bayesian persuasion, establishing that if discrimination is absent, then the optimal signalling problem results in a linear pay-off function (as well as a kind of converse).

Technical Details

RePEc Handle
repec:oup:econjl:v:131:y:2021:i:637:p:2018-2032.
Journal Field
General
Author Count
2
Added to Database
2026-01-25