Economics Seminar | Productivity Effects of Discrimination in the Workplace, Feb. 24

Dr. Glenn Dutcher

The Economics Seminar series presents Dr. Glenn Dutcher discussing “Productivity effects of discrimination in the workplace. An experiment on social identity, favoritism and work effort” on Feb. 24 at 3 p.m. in Bentley Annex 302.

Dutcher is Assistant Professor of Economics at Ohio University.

Abstract: Mounting evidence suggests that discrimination in the workplace is more likely to be due to statistical rather than taste-based discrimination. However, the root causes of the lower levels of productivity for the discriminated against groups are not well understood. One possibility is how discriminated groups internalize the potential discrimination. This study examines how employees internalize discriminatory behavior when they are competing for a reward given by the manager. To do so, an experiment is used where subjects play in a three-person game – two in the role of employees competing for a prize given out by a third in the role of a manager. To study discrimination, induced group identity is used where one of the employees is within the same group as the manager while the other is not. In the main game, the two employees observe the level of favoritism by the manager and then simultaneously choose an effort level which is then seen by the manager who decides prize allocations. Resembling the prize structure in many organizations, two treatments are used where in the first, employees are competing for a bonus while in the second, they are competing for a promotion. Surprisingly, we find that discrimination does not lead to lower effort levels on average. However, the averages hide the finding that females are more affected by the social ties than males. Males contribute the same effort level regardless of their social identity. Outgroup females, on the other hand, contribute much less than males or ingroup females. We also find no difference between the effort of males and ingroup females. These results may help explain the persistence of the ill effects from discrimination and may offer insights into a mechanism which equates the effort of males and females in contests.