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


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

Michael Neugart (Contact Author)

Technical University of Darmstadt ( email )

Hochschulstraße 1
Darmstadt, 64289

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

Stefan Pichler

KOF Swiss Economic Institute, ETH Zürich ( email )

Leonhardstrasse 21
Zurich, 8092

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

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