Do workers discriminate against their out-group employers? Evidence from an online platform economy

Abstract

We study possible labor market discrimination by workers towards their out-group employers as manifested via social preferences (altruism and reciprocity). We run a well-powered, model-based, lab-in-the-field experiment, recruiting 6,000 white American worker subjects from Amazon's M-Turk platform for a real-effort task. We also hire trainer subjects, our stand-in for employers, from a university. To worker subjects, we randomly (and unobtrusively) reveal the racial identity of the trainers, who may be white or black. We find evidence that white workers may discriminate against white employers based on altruism (working harder due to concern for the employer's well-being). However, they may discriminate in favor of their white employers based on reciprocity (working harder because of a small gift). From the perspective of black (white) employers, altruism evokes a stronger (weaker) effort response, but gift-giving has no (positive) effect. Taken together, the combined effect of altruism and reciprocity on worker effort is the same for black and white employers.