Appearance, Inferences About Credit Quality and Learning

Rivista di Politica Economica, Jan-March 2011

26 Pages Posted: 13 Feb 2018

See all articles by Enrichetta Ravina

Enrichetta Ravina

Federal Reserve Bank of Chicago; Center for Economic Policy Research (CEPR); European Corporate Governance Institute (ECGI)

Date Written: March 7, 2011

Abstract

Appearance and personal characteristics, such as age, gender, ethnicity and the way a person presents himself have been shown to play a role in many economic exchanges. Various explanations have been proposed for this finding, ranging from ‘statistical discrimination’, where such variables are surrogates for unobservable characteristics related to the quality of the counterparty, to ‘taste-based discrimination’, where one or both parties experience disutility from interacting with people belonging to certain groups. This paper reviews the theoretical and empirical literature in this area and investigates whether individuals update their beliefs and attitudes toward such characteristics after they learn about outcomes.

Keywords: Beauty, Race, Credit Markets, Learning, Micro Data

JEL Classification: D01, D03

Suggested Citation

Ravina, Enrichetta, Appearance, Inferences About Credit Quality and Learning (March 7, 2011). Rivista di Politica Economica, Jan-March 2011, Available at SSRN: https://ssrn.com/abstract=3119949

Enrichetta Ravina (Contact Author)

Federal Reserve Bank of Chicago ( email )

230 South LaSalle Street
Chicago, IL 60604
United States

HOME PAGE: http://https://sites.google.com/view/eravina/research

Center for Economic Policy Research (CEPR) ( email )

33 Great Sutton Street
London
United Kingdom

European Corporate Governance Institute (ECGI) ( email )

c/o the Royal Academies of Belgium
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Brussels
Belgium

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