Discrimination in Promotion
Does an employer benefit from inducing differential value distributions for a promotion among his workers? Workers compete by exerting effort and higher effort corresponds to higher profit for the employer. Introducing inequalities in valuations makes workers’ values more easily recognisable, reducing their information rent, which in turn increases effort. At the same time, inequalities lead to differences in promotion attainment, even if realised values are identical. This corresponds to a decrease in competition. We show that if value is re-distributed, the reduction in information rent outweighs the loss in competition, making discrimination between workers optimal.

Link to paper: drive.google.com/file/d/1KMfpWh8pxCerEn7kYwtnosvlloYNs6hk/view

Sign up for meetings here: docs.google.com/spreadsheets/d/1WTp83AxJaVGv6sMlwBer43q68i43dAe9BSeyb26ypa4/edit#gid=0
Date: 4 June 2021, 14:15 (Friday, 6th week, Trinity 2021)
Venue: Held on Zoom
Speaker: Anja Prummer (Queen Mary University of London)
Organising department: Department of Economics
Part of: Nuffield Economic Theory Seminar
Booking required?: Not required
Audience: Members of the University only
Editor: Melis Clark