CeDEx Seminar - Matthew Ridley (University of Warwick)

Mental Illness Discrimination

I study discrimination against people with symptoms of depression or anxiety, conditions which are very common, socially stigmatized, and linked to lower earnings and employment. In an online experiment, I find that people pay to avoid depressed or anxious coworkers in a simple communication-based problem-solving task—paying as much to avoid them as they do to work with the college-educated. A model of earnings-maximizing statistical discrimination with correct beliefs cannot explain these preferences: depressed or anxious coworkers are equally productive when exogenously assigned. Instead, I find evidence that discrimination is driven by incorrect beliefs about such coworkers as well as an increase in costly effort when working with them. A major motivation for tackling discrimination is often to encourage revelation of mental illness (thereby perhaps improving access to treatment or support); however, I find that people pay to hide mental illness in my setting even when insulated from rejection or any financial consequence of discrimination.