Exploring Bias and Inclusion: Behavioral Economics and Experimental Insights into Diversity and Discrimination

Abstract

This research explores the role of bias, inclusion, and discrimination in organizational and economic contexts, utilizing behavioral and experimental economics to investigate their impact on hiring, promotions, and wages. The study employs randomized controlled trials (RCTs) and field experiments to analyze how implicit biases affect decision-making processes and contribute to economic inequality, particularly in labor markets. Key interventions, such as anonymized resumes and bias training, are tested for their effectiveness in reducing discriminatory practices and promoting diversity. The research also examines the economic benefits of diversity and inclusion, showing how more diverse workforces enhance innovation, problem-solving, and financial performance. Using econometric techniques, such as difference-in-differences (DiD) models, the study evaluates the outcomes of diversity interventions across multiple industries, providing empirical evidence on the value of inclusion. The findings highlight the persistence of bias in certain sectors but underscore the potential of behavioral nudges to foster more equitable labor market outcomes. This research offers actionable insights for policymakers and organizations aiming to reduce bias, promote inclusion, and improve economic performance through greater diversity.