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Racial disparities in hiring rates are persistent and widespread in the U.S. labor market, in spite of changes in racial attitudes and the increased prevalence of organizational practices that would point towards more equitable treatment. Recent research suggests that, in assessing job applicants, firms tend to first assess the applicants collectively, i.e., as an applicant pool. This sometimes leads firms to determine that the applicant pool they drew collectively does not merit further consideration. Building on this work, in this paper I argue that racial disparities in hiring reflect firms more often declining to consider applicant pools when non-white applicants are prevalent, rather than only from firms favoring white over non-white applicants in deciding who to hire. Declining to consider pools of applicants where non-whites are well-represented is a more subtle and less overt form of racial bias, and thus is likely to persist in the presence of strong norms about equity. I further argue that firms’ propensity to decline pools of applicants where non-white candidates are prevalent is particularly likely when firms are screening large numbers of applicants, in line with arguments about decision complexity or depleted cognitive resources exacerbating racial bias. Using large-scale data from an applicant tracking system prevalent among firms in the U.S. high-tech industry, I find evidence consistent with these claims.
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