The paper “High Standards Enhance Inequality in Idealized Labor Markets” by Károly Takács and Flaminio Squazzoni has been accepted by the Journal of Artificial Societies and Social Simulation. (ISI Impact 2014: 0.941)
We built a simple model of an idealized labor market, in which there is no objective difference in average quality between groups and hiring decisions are not biased in favor of any particular group. Our results show that inequality in employment emerges necessarily also in such idealized situations due to the limited supply of high quality individuals and asymmetric information. Inequalities are exacerbated when employers have high standards and keep only the best workers in house. We found that ambitious workers get higher quality jobs even if ambition does not correlate or even negatively correlates with internal quality. Our findings help to corroborate empirical findings on higher employment discrepancies in high rather than low status jobs.
Keywords: discrimination, labor market mismatch, dual matching, aspirations, sampling bias, agent-based model.