Alicia Sasser Modestino on Diversifying the Dismal Science

By discriminating against women and underrepresented minority groups, the economics profession perpetuates a hidden bias in data collection and analysis that pervades many important areas of policymaking. It should be clear by now that market forces alone will not solve the discipline’s diversity problem.

Alicia Sasser Modestino (Project Syndicate)

Why has the economics discipline failed to diversify its membership? The simple reason is that economists tend to rely on market forces to solve most problems – including discrimination. The late Nobel laureate economist Gary S. Becker’s model of discrimination asserts that employers who discriminate based on factors unrelated to productivity – such as gender or race – will incur monetary costs (by paying higher wages, for example). In a competitive labor market, non-discriminatory employers do not pay this cost and should therefore drive the discriminatory employers out of business.

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