Seminar

Seminar: Don't Demotivate: Discriminate!

Tuesday December 3rd, Otto Swank (EUR) will present "Don't Demotivate: Discriminate!".

Date
December 3, 2013
Time
00:00
Location
CPB-office, Van Stolkweg 14, The Hague

Time: 13.00-14.00 hours
Location: CPB-office, Van Stolkweg 14, The Hague

Presentation: Otto Swank (EUR)

Discussant: TBA

Language: English

Registration:  Please register by sending an email to seminars@cpb.nl.

Abstract subject
This paper offers a new theory of discrimination. We consider a confidence management setting in which two employees compete for a promotion or an important task. We show that self-fulfilling discriminatory equilibria exist where the workers expect the manager to favor one employee. The manager, who has no taste for discrimination, discriminates in order to avoid demotivating the 'favorite'. We show that the non-discriminatory equilibrium is unstable. Yet the manager would prefer to commit not to discriminate. Discrimination is harmful, but hard to avoid.

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