Business Intelligence

The Price Of Prejudice: Labour Market Discrimination On The Grounds Of Gender And Ethnicity

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Executive Summary

Despite some progress, there is still evidence of discrimination on the grounds of gender and ethnic or racial origins in OECD labour markets. Field experiments show pervasive ethnic discrimination in many countries. The authors show indirect cross-country/time-series evidence that, using product market regulation as an instrument, suggests that on average at least 8% of the gender employment gap and a larger proportion of the gender wage gap can be attributed to discrimination. Virtually all OECD countries have enacted anti-discrimination laws in recent decades, and evaluations as well as cross-country analysis suggest that, if well-designed, these laws can be effective in reducing disparities in labour market outcomes. However, enforcement of anti-discrimination legislation is essentially based on victims' willingness to claim their rights.

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