John Körtner (Collegio Carlo Alberto)

Work in Progress Seminars

Bureaucrats’ Beliefs and Disparities in Service Provision

Abstract: Bureaucrats often allocate services disparately across groups. While such disparities may reflect preferences or accurate statistical discrimination, they can also stem from biased beliefs. In this article, I formalize the role of belief bias in bureaucratic decision-making and provide an empirical test using administrative data from the Swiss unemployment insurance system, where caseworkers were required to record subjective assessments of claimants’ employability. I estimate belief bias as the difference in assessments across nationality groups that cannot be justified by actual re-employment outcomes. To solve the challenge that re-employment outcomes are contaminated by caseworkers’ decisions, I develop a novel strategy based on debiased machine learning, combining augmented inverse probability weighting with categorical boosting. I find systematic belief bias against non-Swiss claimants, particularly those from the MENA region and Sub-Saharan Africa. Accounting for the contamination by caseworkers’ program assignment decisions reduces the initial bias but only explains a small part of it. The finding has implications for policies to curtail discrimination in service provision.