The labor market is characterized by search costs, mismatches and asymmetric information. In this context, the use of PCs and the Internet promise to improve and make more efficient worker-firm communications (Autor, 2001; Pissarides, 2000). Internet job search, which involves navigating the web, online job searching, filling forms, writing Word documents and attaching them to an e-mail, is indeed already commonplace. Still, no research examines how Information and Communication Technologies (ICT) skills of workers might play a role in their likelihood of employment. This chapter concentrates on the question of whether people with High ICT skills are more likely to be successful in this new ‘‘wired’’ labor market or not. Specifically, we design an experiment to study whether people with high knowledge of ICT skills (i.e., a line in their resume self-reporting an advanced level of knowledge of various software) are more likely to be contacted after submitting a resume, in the context of two middle-income Latin-American cities.
Our experimental design follows the empirical strategy utilized in the seminal works of Riach and Rich (2002), and Bertrand and Mullainathan (2004) to address the issue of not observing the full set of relevant variables determining individual's labor market productivity. The former study gives an overview of this type of field experiments, while the latter investigates potential discrimination of non-whites (against whites). Since then a host of other studies have been done each focusing on a dimension of discrimination: gender (Booth and Leigh, 2010), immigrants (Carlsson and Rooth, 2007), homosexuality (Ahmed et al., 2011) and beauty (Lopez Boo, Rossi and Urzua, 2010). The common element in these studies is that fake applications are send to real vacancies. These fake applications— within a group— are similar in all except one characteristic, which is the one being randomized. This is the characteristic that defines whether or not there is discrimination. The studies find that males, immigrants, homosexuals and plain looking applicants receive fewer callbacks than females, natives, heterosexuals and good-looking applicants. This is evidence that employers discriminate in the first step of the hiring process since all the characteristics associated with productivity are the same by design.