IZA DP No. 11285: Does Labor Market Tightness Affect Ethnic Discrimination in Hiring?
revised version published as 'Ethnic discrimination in hiring, labour market tightness and the business cycle - Evidence from field experiments.' in: Applied Economics, 2018, 50 (24), 2652 - 2663 [Online]
Several studies using observational data suggest that ethnic discrimination increases in downturns of the economy. We investigate whether ethnic discrimination depends on labor market tightness using data from correspondence studies. We utilize three correspondence studies of the Swedish labor market and two different measures of labor market tightness. These two measures produce qualitatively similar results, and, opposite to the observational studies, suggests that ethnic discrimination in hiring decreases in downturns of the economy.