Do Equal Employment Opportunity Statements Backfire? Evidence from a Natural Field Experiment on Job-Entry Decisions

Abstract

Labor force composition and the allocation of talent remain of vital import to modern economies.  For their part, governments and companies around the globe have implemented equal employment opportunity (EEO) regulations to influence labor market flows.  Even though such regulations are pervasive, surprisingly little is known about their impacts.  We use a natural field experiment conducted across 10 U.S. cities to investigate if EEO statements in job advertisements affect the first step in the employment process, application rates.  Making use of data from nearly 2,500 job seekers, we find considerable policy effects, but in an unexpected direction:  the presence of an EEO statement dampens rather than encourages racial minorities’ willingness to apply for jobs.  Importantly, the effects are particularly pronounced for educated job seekers and in cities with white majority populations.  Complementary survey evidence suggests the underlying mechanism at work is “tokenism”, revealing that EEO statements backfire because racial minorities avoid environments in which they are perceived as regulatory, or symbolic, hires rather than being hired on their own merits.  Beyond their practical and theoretical importance, our results highlight how field experiments can significantly improve policymaking.  In this case, if one goal of EEO regulations is to enhance the pool of minority applicants, then it is not working.

About the presenter’s visit

Dr Andres Leibbrandt will be visiting the School of Economics on Friday 12^th April.  While here he will be using room 520A Colin Clark Building.  If you would like to meet with him or have lunch or dinner with him please contact Dr Marco Faravelli who will be his host while at The University of Queensland.  Dr Faravelli can be contact on m.faravelli@uq.edu.au.