Data and code for: "Assortative Matching or Exclusionary Hiring? The Impact of Employment and Pay Policies on Racial Wage Differences in Brazil"

We measure the effects of firm policies on racial pay differences in Brazil. Nonwhites are less likely to be hired by high-wage firms, explaining about 20% of the racial wage gap for both genders. Firm-specific pay premiums for nonwhites are also compressed relative to whites, contributing another 5% for that gap. A counterfactual analysis reveals that about two-thirds of the under-representation of nonwhites at higher-wage firms is explained by race-neutral skill-based sorting. Non-skill-based sorting and differential wage setting are largest for college-educated workers, suggesting that the allocative costs of discriminatory hiring and pay policies may be relatively large in Brazil.