21 October 2008

This simple experiment demolished any idea that racial discrimination is a thing of the past

Sticks and stones can break bones, but the wrong name can make a job hard to find

To test whether employers discriminate against black job applicants, Marianne Bertrand of the University of Chicago and Sendhil Mullainathan of M.I.T. conducted an unusual experiment. They selected 1,300 help-wanted ads from newspapers in Boston and Chicago and submitted multiple résumés from phantom job seekers. The researchers randomly assigned the first names on the résumés, choosing from one set that is particularly common among blacks and from another that is common among whites.

So Kristen and Tamika, and Brad and Tyrone, applied for jobs from the same pool of want ads and had equivalent résumés. Nine names were selected to represent each category: black women, white women, black men and white men. Last names common to the racial group were also assigned. Four résumés were typically submitted for each job opening, drawn from a reservoir of 160. Nearly 5,000 applications were submitted from mid-2001 to mid-2002. Professors Bertrand and Mullainathan kept track of which candidates were invited for job interviews.

No single employer was sent two identical résumés, and the names on the résumés were randomly assigned, so applicants with black- and white-sounding names applied for the same set of jobs with the same set of résumés.

Apart from their names, applicants had the same experience, education and skills, so employers had no reason to distinguish among them.

The results are disturbing. Applicants with white-sounding names were 50 percent more likely to be called for interviews than were those with black-sounding names. Interviews were requested for 10.1 percent of applicants with white-sounding names and only 6.7 percent of those with black-sounding names.

This article is from 2002, so perhaps some change in attitudes have occurred since.

If Affirmitive Action programs are not the solution, then what is the antidote? Or as some believe, no corrections, which are often tainted with unintended consequences, are necessary, as things will shake out eventually.

This study by Marianne Bertrand and Sendhil Mullainathan was highlighted in a chapter titled "The Dangers of Rational Racism" within "The Logic of Life: The Rational Economics of an Irrational World". I am Almost finished, it is an excellent read and I plan to review more on these provocative inspections of "rational" economic actors in further posts. Other standout chapters include "Is Divorce Underrated" and "Why Your Boss is Overpaid". If you've read Freakonomics, it is in a similar vein, but I think this book by Tim Harford to be a notch above that one.

Back to Harford's look at "rational racism" — he details how economists break down racism into two kinds — "taste-based" (aka bigotry) and statistical (or his favored term, rational) racism. Taste-based racism hurts both the bigot and the victim. The racist acts against his economic interest is also harmed, as his meritocracy seeking competition will out perform his outfit. Statistical racism, on the other hand, is profitable for the business proprietor, and worse, condemns the victim to a status whereby her efforts to improve her economic lot matter not, thus dooming the affected minority to self-defeating cycle of poverty. The disparity will not go away on its own accord, and that is the difference between rational racism and taste-based discrimination.