Asked by Harpreet Singh on Jul 20, 2024
Verified
Suppose an employer is biased against African Americans. If his discrimination coefficient is $2, the employer will
A) randomly hire African-American and white workers if the actual African-American-white wage differential is more than $2.
B) randomly hire African-American and white workers if the actual African-American-white wage differential is less than $2.
C) hire only African Americans if the actual African-American-white wage differential is less than $2.
D) hire only whites if the actual African-American-white wage differential is less than $2.
Discrimination Coefficient
A measure used to quantify the extent to which prices are adjusted based on customer characteristics in markets where price discrimination occurs.
African Americans
A racial or ethnic group in the United States characterized by an ancestry linked to Africa, particularly sub-Saharan Africa.
Wage Differential
The variation in wages earned by individuals in different jobs, industries, geographic locations, or by workers with varying skill levels.
- Gain an understanding of the notion and repercussions of bias in the employment sector.
- Examine the effect that discrimination coefficients have on the recruitment strategies of employers.
Verified Answer
LL
Laila LohseJul 21, 2024
Final Answer :
D
Explanation :
The discrimination coefficient represents the monetary value of the employer's bias against hiring African Americans. If the wage differential is less than the discrimination coefficient ($2 in this case), the employer's bias outweighs the cost savings from hiring lower-wage African American workers, leading the employer to hire only white workers.
Learning Objectives
- Gain an understanding of the notion and repercussions of bias in the employment sector.
- Examine the effect that discrimination coefficients have on the recruitment strategies of employers.