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Costless discrimination and unequal achievements in an experimental tournament

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  • Antonio Filippin
  • Francesco Guala

Abstract

We investigate the emergence of discrimination in an experiment where individuals affiliated to different groups compete for a monetary prize, submitting independent bids to an auctioneer. The auctioneer receives perfect information about the bids (there is no statistical discrimination), and she has no monetary incentive to favor the members of her own group (the bidders are symmetric). We observe nonetheless some discrimination by auctioneers, who tend to assign the prize more frequently to a member of their own group when two or more players put forward the highest bid. Out-group bidders react to this bias and reduce significantly their bids, causing an average decay of their earnings throughout the game, with cumulative effects that generate unequal outcomes. Because the initial bias is costless, such mechanism can survive even in a competitive market, providing a rationale for the long-run persistence of discrimination. Copyright Economic Science Association 2013

Suggested Citation

  • Antonio Filippin & Francesco Guala, 2013. "Costless discrimination and unequal achievements in an experimental tournament," Experimental Economics, Springer;Economic Science Association, vol. 16(3), pages 285-305, September.
    • Handle: RePEc:kap:expeco:v:16:y:2013:i:3:p:285-305
    DOI: 10.1007/s10683-012-9334-8
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    2. Emmanuel Dechenaux & Dan Kovenock & Roman Sheremeta, 2015. "A survey of experimental research on contests, all-pay auctions and tournaments," Experimental Economics, Springer;Economic Science Association, vol. 18(4), pages 609-669, December.
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    6. Mill, Wladislaw & Morgan, John, 2022. "Competition between friends and foes," European Economic Review, Elsevier, vol. 147(C).

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    More about this item

    Keywords

    Discrimination; Tournament; Groups; Experiment; J71; D44; C9;
    All these keywords.

    JEL classification:

    • J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing
    • D44 - Microeconomics - - Market Structure, Pricing, and Design - - - Auctions
    • C9 - Mathematical and Quantitative Methods - - Design of Experiments

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