Discrimination in Online Contracting: Evidence from Latin America

Abstract

We analyze transactional data in Nubelo, a large online labor market serving the Spanish-speaking markets. Our results corroborate the presence of discrimination based on worker’s country of origin. In our most conservative estimate, foreign workers are 15% less likely to obtain contracts in Nubelo compared to domestic workers. Yet our results indicate that this discrimination is statistical rather than taste-based, as it decreases when more information about workers’ quality becomes available to employers. Contrary to some of the findings in traditional labor markets, we do not find evidence of discrimination against women in online hiring. In fact, women have a small advantage, particularly among female employers. However we do observe that women ask for lower wages, particularly when bargaining with male employers. Our findings shed light on how differentials in traditional labor markets play out in online labor environments.

Keywords: online labor market, Spanish-speaking markets, Nubelo, discrimination

JEL Classification: J44