Attentional role of quota implementation
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Attentional role of quota implementation. / Matveenko, Andrei; Mikhalishchev, Sergei.
I: Journal of Economic Theory, Bind 198, 105356, 23.09.2021.Publikation: Bidrag til tidsskrift › Tidsskriftartikel › Forskning › fagfællebedømt
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TY - JOUR
T1 - Attentional role of quota implementation
AU - Matveenko, Andrei
AU - Mikhalishchev, Sergei
PY - 2021/9/23
Y1 - 2021/9/23
N2 - In this paper, we introduce a new role of quotas, e.g. labor market quotas: the attentional role. We study the effect of quota implementation on the attention allocation strategy of a rationally inattentive (RI) manager. We find that quotas induce attention: a RI manager who is forced to fulfill a quota, unlike an unrestricted RI manager, never rejects minority candidates without acquiring information about them. We also demonstrate that in our model quotas are behaviorally equivalent to subsidies. In addition, we analyze different goals that the social planner can achieve by implementing quotas. First, quotas can eliminate sta-tistical discrimination, i.e. make the chances of being hired independent from the group identity. Second, when the hiring manager has inaccurate beliefs about the distribution of candidates’ productivities, the so-cial planner can make the manager behave as if she has correct beliefs. Finally, we show how our results can be used to set a quota level that increases the expected value of the chosen candidates.
AB - In this paper, we introduce a new role of quotas, e.g. labor market quotas: the attentional role. We study the effect of quota implementation on the attention allocation strategy of a rationally inattentive (RI) manager. We find that quotas induce attention: a RI manager who is forced to fulfill a quota, unlike an unrestricted RI manager, never rejects minority candidates without acquiring information about them. We also demonstrate that in our model quotas are behaviorally equivalent to subsidies. In addition, we analyze different goals that the social planner can achieve by implementing quotas. First, quotas can eliminate sta-tistical discrimination, i.e. make the chances of being hired independent from the group identity. Second, when the hiring manager has inaccurate beliefs about the distribution of candidates’ productivities, the so-cial planner can make the manager behave as if she has correct beliefs. Finally, we show how our results can be used to set a quota level that increases the expected value of the chosen candidates.
KW - Faculty of Social Sciences
KW - Discrete choice
KW - rational inattention
KW - Multinomial logit
KW - quotas
U2 - 10.1016/j.jet.2021.105356
DO - 10.1016/j.jet.2021.105356
M3 - Journal article
VL - 198
JO - Journal of Economic Theory
JF - Journal of Economic Theory
SN - 0022-0531
M1 - 105356
ER -
ID: 280609613