Underrepresented Groups, Job Search, and Fear of Failure

Workers who anticipate bias may avoid challenging jobs where they are likely to face discriminatory penalties for mistakes. Economists Michelle Jiang and Alexandra Opanasets ask: 1) Do workers from underrepresented groups take disproportionate actions to avoid failure on the job, such as not taking on better-paying jobs with a higher risk of failure? 2) If so, is this because they anticipate discriminatory penalties for failure on the job, either for themselves or for others in their demographic group? 3) What proportion of failure aversion is due to anticipating discrimination, as opposed to behavioral mechanisms? The investigators will run an online two-sided labor market experiment with two sets of participants—workers and employers—in which they randomly vary the potential consequences for failure on the job and observe how this affects job choices for workers from different demographic groups. In certain cases, failure on the job will only monetarily affect the employer and the employee; in others, failure could negatively affect a worker’s future employment or the employment of someone else from their demographic group. The outcome of interest is whether a worker chooses to transition from a simple, low-paying task to a more challenging, higher-paying task.