Statistical discrimination is frequently applied to illustrate different economic opportunities among equally able individuals. We use statistics from 1994, the second wave of the Survey of Labour and Income Dynamics, to analyze the income received from paid work jobs as the measure of an individuals economic opportunity. At the same time, Heckmans two-stage procedure is performed to account for possible bias that arises from estimating with only a pool of paid workers. We are interested in testing the following hypotheses: whether employers statistically discriminate among potential workers on the basis of education and immigration status if they have limited information about those workers and whether they learn to revise their judgments as new information is obtained.
The results confirm the employer learning and statistical discrimination based on years of schooling hypotheses for the Canadian labour market. The labour market returns to initially unobservable characteristic increases with time spend in the labour market. In addition, wage becomes less related to education that employers initially use to infer an individuals productivity. On the other hand, immigration status is not very informative about the productivity of a worker and the results do not support the hypothesis of statistical discrimination on the basis of immigration status. This paper points out the challenges faced by traditional labour market policies in a world of statistical discrimination and employer learning.
| Identifer | oai:union.ndltd.org:LACETR/oai:collectionscanada.gc.ca:SSU.etd-04062005-124813 |
| Date | 07 April 2005 |
| Creators | Pan, Shih-Yi |
| Contributors | Vaidyanathan, Ganesh, St. Louis, Larry, Huq, M. Mobinul, Altman, Morris |
| Publisher | University of Saskatchewan |
| Source Sets | Library and Archives Canada ETDs Repository / Centre d'archives des thèses électroniques de Bibliothèque et Archives Canada |
| Language | English |
| Detected Language | English |
| Type | text |
| Format | application/pdf |
| Source | http://library.usask.ca/theses/available/etd-04062005-124813/ |
| Rights | unrestricted, I hereby certify that, if appropriate, I have obtained and attached hereto a written permission statement from the owner(s) of each third party copyrighted matter to be included in my thesis, dissertation, or project report, allowing distribution as specified below. I certify that the version I submitted is the same as that approved by my advisory committee. I hereby grant to University of Saskatchewan or its agents the non-exclusive license to archive and make accessible, under the conditions specified below, my thesis, dissertation, or project report in whole or in part in all forms of media, now or hereafter known. I retain all other ownership rights to the copyright of the thesis, dissertation or project report. I also retain the right to use in future works (such as articles or books) all or part of this thesis, dissertation, or project report. |
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