Abstract
This chapter surveys the literature of the past 20 years on group identity and intergroup bias which serve as important underpinnings for labor market discrimination. Main economic domains are identified in which the literature has shown the important influences of group identity. With exceptions, group identity leads to ingroup favoritism and outgroup discrimination in these domains. While minimal groups are found inadequate to generate a salient group identity to influence decision-making in strategic settings, minimal group identity can nonetheless be strengthened and, as a result, affect choices in broad economic settings. The presence and magnitude of intergroup discrimination in artificially induced or naturally occurring groups exhibit substantial heterogeneity across individuals and are dependent on a broad range of economic, cultural, and political factors. Preference- and belief-based mechanisms are both important drivers of intergroup discrimination.
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Li, S.X. (2020). Group Identity, Ingroup Favoritism, and Discrimination. In: Zimmermann, K. (eds) Handbook of Labor, Human Resources and Population Economics. Springer, Cham. https://doi.org/10.1007/978-3-319-57365-6_123-1
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