A Tradable Employment Quota

45 Pages Posted: 14 Jan 2015 Last revised: 13 Aug 2015

See all articles by Metin Akyol

Metin Akyol

Technical University of Darmstadt

Michael Neugart

Technical University of Darmstadt

Stefan Pichler

KOF Swiss Economic Institute, ETH Zürich

Date Written: July 2015

Abstract

Discrimination of women in the labor market requires appropriate policy interventions. Affirmative action policies typically advocate the introduction of an employment quota uniformly applied to all firms. In a heterogeneous labor market such a policy may yield avoidable welfare losses. We propose a tradable employment quota showing its effects on wages, employment, and welfare in a labor market with search frictions and taste discrimination. A tradable employment quota appears to be a viable alternative yielding superior labor market outcomes.

Keywords: tradable employment quota, affirmative action policies, taste discrimination, labor market, search and matching, agent-based model

JEL Classification: J71, J78, C63

Suggested Citation

Akyol, Metin and Neugart, Michael and Pichler, Stefan, A Tradable Employment Quota (July 2015). Available at SSRN: https://ssrn.com/abstract=2548435 or http://dx.doi.org/10.2139/ssrn.2548435

Metin Akyol

Technical University of Darmstadt ( email )

D-64283 Darmstadt
Germany

Michael Neugart (Contact Author)

Technical University of Darmstadt ( email )

Hochschulstraße 1
Darmstadt, 64289
Germany

HOME PAGE: http://www.vwl3.wi.tu-darmstadt.de

Stefan Pichler

KOF Swiss Economic Institute, ETH Zürich ( email )

Leonhardstrasse 21
Zurich, 8092
Switzerland

HOME PAGE: http://www.kof.ethz.ch

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