We propose a simple model of racial bias in hiring that encompasses three major theories: taste-based discrimination, screening discrimination, and complementary production. We derive a test that can distinguish these theories using the mean and variance of workers' productivity under managers...

Using unique Chinese data classifying labor according to the function it performs within a firm, we document that growth in the marketing and sales workforce positively predicts future profitability and returns in the cross-section, with an annual long-short portfolio return spread of 7.4%.In...

This study was prepared by Stefan Lachenmaier while he was working with the Ifo Institute for Economic Research. It was completed in March 2007 and was accepted as a doctoral thesis by the Economics Department of the University of Munich (LMU). The subject of this study is an econometric...