Do Employers Discriminate Less if Vacancies Are Difficult to Fill? Evidence From a Field Experiment

We empirically test the relationship between hiring discrimination and labour market tightness at the level of the occupation. To this end, we conduct a correspondence test in the youth labour market. In line with theoretical expectations, we find that, compared to natives, can- didates with a foreign sounding name are equally often invited to a job interview if they apply for occupations for which vacancies are difficult to fill, but they have to send twice as many applications for occupa- tions for which labour market tightness is low. Our findings are robust against various sensitivity checks.