LAUSR

Abstract Is there a Muslim disadvantage in economic integration to the Chinese economy? Do political mandates from the government help reduce disparities? To answer these questions, we conducted a large-scale audit study and submitted over 4000 resumes of fictitious male candidates to job advertisements for accounting and administrative positions posted by private firms, state-owned firms and foreign firms. We randomized the ethnic identities of job applicants, their academic merit, and requested salaries. Our results show that a Muslim job seeker is more than 50% less likely to receive a callback than a Han job seeker, and higher academic merit does not compensate for this bias. Importantly, we find that state-owned enterprises are equally likely to discriminate against Muslim job seekers, despite their political mandate to increase diversity. Interview evidence suggests that besides productivity concerns and outright hostility towards outgroups, bias is also driven by employer concerns over the operational costs of accommodating a diverse workforce.