Which one of the following statements concerning employee discrimination is not

Question

Which one of the following statements concerning employee discrimination is not true? Employers have no reason to employ a segregated workforce if there is employee discrimination. Employee discrimination does not affect the profitability of firms as long as firms can employ segregated work forces. Employee discrimination will not produce a wage differential between equally skilled black and white workers. Discriminating employees act as if their wage is less than it actually is if they are employed by a firm that has an integrated workforce. Suppose the value of marginal product is $20 per hour regardless of race. An employer who faces an hourly wage of $14 per black worker and $17 per white worker decides to hire all white workers. What kind of discrimination is this? Employee discrimination. Consumer discrimination. Employer discrimination. Statistical discrimination. The Human Resources department at a firm has two job candidates for one position. Both candidates went to the same college, took the same classes and have the same academic record. They both performed well in the interview and said that they see the job as a longterm position. One applicant is male; the other is female. Historically within the firm, women quit their jobs at higher rates than do men. Because of this, die firm fills the position with the male candidate. What kind of discrimination is this? Employee discrimination. Consumer discrimination. Employer discrimination. Statistical discrimination. In the standard Becker model of discrimination, each firm is associated with a discrimination coefficient of d >0 and acts as if the wage paid to blacks is w_B(1 + d) where W_B is the actual hourly wage paid to blacks. In equilibrium, a threshold level of d, labeled d*, comes about that sorts firms based on hiring decisions. Which of the following is not an outcome of this model? All firms with d notequalto d* will employ all blacks or all whites. Profits fall as d increases as long as d d*earn the same amount of profit.

Explanation / Answer

Q4. In the given case, even though both white and black workers have same value with respect to marginal product and with black workers having low wage rate than white workers, employing black workers could result in higher profit for firm then also firm is hiring all white workers.

When an employer made employment discrimination based on race, gender, religion etc. then such discrimination is termed as employer discrimination.

So, this is employer discrimination.

Hence, the correct answer is option (c).

Q5. In the given case, historical data with respect to longevity on job has induced the firm to hire the male workers.

So, employment inequality in given case is based on historical data developing a stereotype.

When employment inequality results from historical data developing a stereotype, it is termed as statistical discrimination.

So, this is case of statistical discrimination.

Hence, the correct answer is option (d).

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