Competition and gender prejudice: Are discriminatory employers doomed to fail?

Autor(en)

Andrea Weber, Christine Zulehner

Abstrakt

According to Becker's famous theory on discrimination (Gary Becker, The Economics of Discrimination, University of Chicago Press), entrepreneurs with a strong prejudice against female workers forgo profits by submitting to their tastes. In a competitive market their firms lack efficiency and are therefore forced to leave. We present new empirical evidence for this prediction by studying the survival of start-up firms in longitudinal matched employer-employee data. We find that firms with strong preferences for discrimination approximated by a low share of female employees relative to the industry average have significantly shorter survival rates. This is especially relevant for firms starting out with female shares in the lower tail of the distribution. Competition at the industry level additionally reduces firm survival and accelerates the rate at which prejudiced firms are weeded out. We also find evidence for employer learning as highly discriminatory start-up firms that manage to survive submit to market powers and increase their female workforce over time.

Organisation(en)

Externe Organisation(en)

Universität Mannheim, Johannes Kepler Universität Linz, Österreichisches Institut für Wirtschaftsforschung (WIFO)

Journal

Journal of the European Economic Association

Band

12

Seiten

492-521

Anzahl der Seiten

30

ISSN

1542-4766

DOI

https://doi.org/10.1111/jeea.12048

Publikationsdatum

2014

Peer-reviewed

Ja

ÖFOS 2012

502053 Volkswirtschaftslehre, 502013 Industrieökonomik

ASJC Scopus Sachgebiete

Economics, Econometrics and Finance(all)

Link zum Portal

https://ucrisportal.univie.ac.at/de/publications/155bff5d-3202-40d5-b48a-5962c3b5b70e