Econometrics Seminar

Du 08/04/2022 de 14:30 à 15:45

CREST, Salle 3001

MILLER Robert (Cargnegie Mellon University)

Search and Matching by Race and Gender

This project uses data from a large firm that provided information on all job applications as well as labor market outcomes within the firm over a 5 year period. Careful analysis of the data shows that African Americans and women engage in more overt job search activity within the organization than Caucasian males, attain shorter tenure on each job, and experience slower wage growth. Furthermore, we see some differences across race and gender when we look at each stage of the application process. In particular, we see that African Americans are more likely to apply for positions that they do not meet the minimal qualifications for, and both African Americans and women are more likely to withdraw from the application process. We also see that African Americans are less likely to be interviewed for a position, although we do not see any differences with race for hiring probabilities conditional on being interviewed. To explain these empirical patterns, we develop and estimate a model of two sided search and matching, in which positions become vacant when the current occupant of the job leaves, the firm begins a search process by advertising the position, and workers employed both inside and outside the organization apply for the newly vacated position. Workers choose their intensity of job search by setting a threshold above which they would accept a job offer. The applicants are culled during a hiring process that lead both parties to become more informed about the potential job match with each applicant. The successful applicant accumulates experience on-the-job. After estimating the model, we will use counterfactuals to understand more about the differences in the search and matching process across racial and gender groups, as well as how that affects wage outcomes. First, we know in the data that the durations that people stay in a job differs by race and gender. Our counterfactuals can analyze how large of a role these durations play in the hiring process. Second, we can study how outcomes would change if the hiring committee is forced to interview more or fewer candidates. This can help to understand how institutional restrictions will affect the likelihood that an individual is offered a position.