Recent Contributions to Theories of Discrimination

TL;DR

This survey reviews recent advances in theories of discrimination, highlighting new models that incorporate learning, signaling, behavioral biases, and institutional factors, bridging economic and social science perspectives.

Contribution

It synthesizes recent theoretical developments in discrimination, emphasizing novel information, mechanism design, and behavioral models, and connects economic theories with social science approaches.

Findings

New models incorporate learning and signaling environments.

Analysis of algorithms' decision-making processes.

Integration of social norms and institutional design in discrimination theories.

Abstract

This paper surveys the literature on theories of discrimination, focusing mainly on new contributions. Recent theories expand on the traditional taste-based and statistical discrimination frameworks by considering specific features of learning and signaling environments, often using novel information- and mechanism-design language; analyzing learning and decision making by algorithms; and introducing agents with behavioral biases and misspecified beliefs. An online appendix attempts to narrow the gap between the economic perspective on ``theories of discrimination'' and the broader study of discrimination in the social science literature by identifying a class of models of discriminatory institutions, made up of theories of discriminatory social norms and discriminatory institutional design.