Discrimination, social identity, and coordination: An experiment

We present an experimental study investigating the effect of social identity on hiring decisions under uncertainty. We want to know whether people discriminate between own and other group candidates. The key feature of the experiment is to consider whether they do so in individual, as well as in joint decisions. The analysis indicates that in spite of not exhibiting discriminatory behavior when deciding individually, participants discriminate if they have an incentive to coordinate their decision with a co-decision maker. Our experiment thus suggests a rationale for discrimination additional to those considered in the literature and provides empirical evidence of it. That is, we show that people may discriminate not because of their individual attitudes, but because of expectations of what their co-decision makers will do, or because of what they expect that their co-decision makers expect them to do, etc. Furthermore, we analyze which particular configurations of the social identities of the decision makers and candidates lead to biases in decisions.