Abstract:
We conduct a correspondence study using a digital job platform in Malaysia. We test the presence of ethnic and gender discrimination in the hiring process. We find strong evidence of ethnic discrimination in the Malaysian labor market. Malay and Indian candidates are discriminated against relative to Chinese candidates. Discrimination occurs in all stages of the hiring process: rejected applications, profile visits, contact, and interview offers. We do not find evidence of gender discrimination. We also test the relevance of a soft skill in the job applications and find that signaling a teamwork skill attenuates the ethnic contact gap by 8 percentage points. Large companies, companies with less competition, high paying jobs and companies that process applications quickly discriminate more. These results are consistent with a model where employers put differential effort while processing applications, providing evidence in favor of statistical discrimination.
