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Misperception and informativeness in statistical discrimination
Matteo Escud\'e, Paula Onuchic, Ludvig Sinander, Quitz\'e Valenzuela-Stookey
https://arxiv.org/abs/2508.20053

Misperception and informativeness in statistical discrimination
We study the interplay of information and prior (mis)perceptions in a Phelps-Aigner-Cain-type model of statistical discrimination in the labor market. We decompose the effect on average pay of an increase in how informative observables are about workers' skill into a non-negative instrumental component, reflecting increased surplus due to better matching of workers with tasks, and a perception-correcting component capturing how extra information diminishes the importance of prior misperceptions…