Testing for racial discrimination in the labour market

Abstract

In recent years there have been several studies of racial discrimination in the British labour market which made use of an experimental technique.Between November 1983 and November 1988 we applied such a technique to provide a direct measure of labour market discrimination in the Australian state of Victoria.The results of our test for sexual discrimination in the labour market have been published (Riach and Rich, 1987), and this paper provides the results of our test for racial discrimination.The experimental technique which we used is known as 'correspondence testing' and was first applied in 1969 to measure the incidence of racial discrimination in the British labour market.This technique, which involves sending carefully matched pairs of written job applications in response to advertised vacancies, was devised by Jowell and Prescott-Clarke (1970).In their study, one letter purported to be from a white British applicant and the other purported to be from a West Indian, an Asian, an Australian or a Cypriot.The same technique has subsequently been used by Mclntosh and Smith (1974), Firth (1981), Hubbock and Carter (1980), and Brown and Gay (1985).All five studies were concerned with testing the extent of racial discrimination in the British labour market.We have applied this same experimental technique to assess the incidence of racial discrimination in the Victorian labour market.Victoria is the most densely populated Australian state: in 1986 it had a total population of 4,019,000 of whom 2,833,000 were located in the capital city, Melbourne.Two recent immigrant groups, Greeks and Vietnamese, were chosen to match against the long-established, predominantly Anglo-Celtic population.The build-up of the Greek and Vietnamese immigrant groups is shown in Table 1.The choice of these two groups enables us to compare the experience of a European group, which has an immigration record stretching back several decades, with the experience of a group of much more recent arrivals from Asia.The former group is less distinguished than is the latter from the dominant Anglo-Celtic population, both in skin colour and geographical origin.However, both minority groups are encompassed by Australian racial discrimination legislation.

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