The Impact of Financial Stress on Workplace Harassment and Discrimination

Abstract

I study the impact of financial stress on the incidence of harassment and discrimination using Equal Employment Opportunity (EEO) charges brought forward by U.S. Postal Service workers. An analysis of more than 800,000 EEO charges filed between 2004 and 2019 demonstrates that financial stress experienced in the second week of the pay cycle increases EEO incidents by about 5% compared with the first week. Further analyses suggest that the uncovered effects are driven by changes in the number of incidents rather than in their reporting. This paper was accepted by Yan Chen, behavioral economics and decision analysis. Funding: This work was supported by the Laboratory for Economic Analysis and Policy at Harvard University and a James M. and Cathleen D. Stone PhD Scholar fellowship from the Multidisciplinary Program in Inequality & Social Policy. Supplemental Material: The data files and online appendix are available at https://doi.org/10.1287/mnsc.2023.4815 .