We present new theory and empirical evidence concerning racial discrimination in promotions. In our model, promotions signal worker ability. When tasks differ substantially across levels of a job hierarchy, the opportunity cost (in terms of foregone output) of not promoting qualified nonwhite...

We extend promotion signaling theory to generate new testable implications concerning racial differences in promotions. In our model, promotions signal worker ability. When tasks differ substantially across job levels, the opportunity cost of not promoting qualified nonwhites/non-Asians is...