Speaker: Paolo Falco, Associate Professor, Economics, University of Copenhagen
Abstract: We conduct an experiment with 56,000 Danish households (over 2 percent of the population), who receive an advertisement from a Danish company offering basic cleaning services. We vary the price and the available operators, who differ in their ethnicity but meet identical quality standards. We find that, on average, demand for a migrant operator is 45 percent lower than demand for a native, but the gap is sensitive to price. It grows larger as the price increases since the demand for a migrant falls more steeply than the demand for a native. This is consistent with consumers having a lower willingness to pay for migrant workers than equivalent native workers. The results shed light on an important source of labor-market discrimination.
The paper can be found here.