Contents
Introduction
Personal prejudice model: employer discrimination
Personal prejudice model: customer discrimination
Personal prejudice model: employee discrimination
Conclusion
Information sources

Introduction
Issue of various types of discrimination has been a very popular topic lately. It has been enjoying a significant media attention, as it is very controversial and concerns one of the most basic human wants, namely to be treated fairly. However, what does it mean “fair” or what is the “truth”? In light of the complexity of every individual situation, this is certainly not easy to say and looking at the pure statistics can be often misleading.
Discrimination (in means of treating the same in different ways) has its roots in human history and biology. Discrimination has always been around us and will always be. Imagination of ultimate social fairness is utopian. Nothing can stop people from making distinctions between certain groups of people or creating human clusters. Furthermore, a freedom of human actions should also not be restricted (within the law, of course). Having these two elementary fundaments in mind, fair prerequisites for discriminatory behaviour is established.
All people have preferences and prejudices and act accordingly. Rational behaviour applies. However, it is very often interpreted in the misleading form, especially in connection with this issue. Theory indeed likes to compare two “products” or “human force units” which have the same “quality and productivity” but totally neglects the psychological level of human decisions. If I have a certain preference (from any reason), choosing the second option (despite having the same “objective” quality) results in psychic loss. This must be considered.
If I had a bad experience with a French car in the past, I will prefer other brands, even though the objective quality is currently at least on the same level. I have always wanted to have a good and nice watch. Influenced by my prejudice, I decided for the “Swiss quality” Even though I am satisfied with my choice in principle, objectively they leg behind more considerably than my previous cheap American watch. Do I discriminate the French cars and American watch producers? Theory would suggest I do. However according to my personal opinion, I do not. I just chose a different option, which minimizes the level of possible future risk. Market does not provide perfect information therefore I need to act according to my own knowledge. I met a choice in the competitive environment.
Considering the labour force as a resource, absolutely same rules apply. In this case, however, people do not speak about the free choice, but discrimination. Admittedly, people are not tools or goods and therefore should be treated in another way. However, this reflects rather social and political than economic point of view.

Personal prejudice model: employer discrimination
In this case, employer is subjectively devaluating the productivity of a certain group (minority, gender etc.), considering the productivity is equal. In a simple mathematic equation it can be described as follows:
WM = WF + d
On an example of gender discrimination, it can be seen, that women are systematically devaluated by d in comparison with men. Therefore, they are worse off.

This approach is surely taking place very frequently. Most people (and companies) unconsciously devaluate certain groups of people on the basis of individual prejudices. Certain types of relationships, likes and dislikes just apply no matter where we look. As long as humans are deciding (and not computers) these effects will appear. Statistics as well as scientific researches confirm this fact occurring both in the form of wage and occupational discrimination. However the most crucial question is why it is so. Why do women or members of ethnic minorities earn less and work at worse positions? I believe the reasons are much deeper and more logical, than some superficial arguments suggest.
Women had a totally different position in society in the past. This has been gradually changing over time, but general perception and traditions still have strong influence. Women used to be connected with the family and household. On the other hand, men were responsible for organising the resources and providing the necessary security. The natural positions of male and female has been changing lately, but it is hard to make a thick line after such historical heritage. Crucial point is also the biological difference from both psychical and physical point of view. Physiological issues are clear and need not to be discussed any further. Large number of vacancies has this as the main prerequisite which determines the occupants (e.g. miners, taxi or truck drivers). As the horoscope says, men are from Mars and women from Venus. So different are also the processes of thinking. Men tend to be more analytical and technical, women are closer to humanities. Composition of students in these branches clearly confirms this tendency. As companies take every chance to decrease the possible risks and the lowest possible costs, they take these general (however, not always valid) prejudices (even though based on the real tendency) into consideration. If a certain ethnic group possesses some specific feature, this general rule applies as well.
E.g. cleaning services done by the Ukrainian ladies are especially popular and demanded in Prague restaurants. Why is that? Firstly they are mostly females, because men can earn more (considering an equally unqualified job), due to their physical structure and endurance (mines, building sites, forest work). Secondly, the overall experience with Ukrainian cleaning ladies is very good. Salaries may be considered equal, but the Ukrainian tends to appreciate her job more, and show a better quality of work. Same scenario applies for the Vietnamese and Mongolian workers in the manufacturing branches.

Personal prejudice model: customer discrimination
Companies are represented by humans and these people also have personal lives. They make customer decisions every day, being influenced by the same factors. Prejudices in this case are sometimes so strong, that companies, knowing about this fact, must accordingly adjust the service, in order to meet the customer needs. For many people, it is hard to imagine for example a female pilot or technician, even though the gender does not need to have effect on productivity or quality. If a gipsy sells any products on the street, he/she would most likely be accused or even convicted for stealing them by the people passing by.

Personal prejudice model: employee discrimination
Even employees by themselves often tend to discriminate. They may refuse to work under the command of a different gender or nationality. Employees are naturally changing positions in companies over time. This can create tension. However, this behaviour by far does not only concern women or minorities. The same effects of separation (or discrimination) can happen to people distinguishing from the majority in any way (e.g. different education, hobbies, political view, accent or origin within one country).
Conclusion
To sum up, it can confidently be said, that the issue of discrimination has its very deep roots in the human substance. Prejudices are the natural result of certain safety reflex, subconscious cost minimization and learning from one owns mistakes. If I hire twice a Hispanic man and in both cases they show similar problem of e.g. being irresponsible, I will prefer another candidate for the third time, considering other qualities are the same. This action stays in conformity with the proverb: “One will not step into the same river twice”, even though the third candidate could have been the very best employee in the entire firm. People want to be from nature a part of certain group and will fight anything that stands in the way. Different look or gender is the easiest differentiation feature.
Measures to ease or even eliminate these effects can be found in the long term education and life experience. This can be confirmed by the recent positive development in many countries, which focus on these issues. State can also set some legislative frameworks in order to support the equality. However, this must be done with an extreme conscience, as the primary fundaments of free market and choice may not be endangered.
In the very conclusion, I would like to mention my own empirical experience regarding this issue. I have lived in 5 different countries for a longer period of time. The conclusion that I can make is, that every discrimination start primarily in the head of the “discriminated” person. If anybody has a complex of inferior, he or she will afterwards be indeed discriminated. Entering new environments is always very difficult. One must interfere into established relationships, learn new processes and rules. This requires considerable and additional efforts (in comparison with other employees). Finding the excuse in the so called discrimination is the easiest way, how to avoid these additional efforts or inability to adjust. I personally know three very successful female managers or businesswomen (one is the general manager of a front media house in the Czech Republic, second the general manager of the largest real estate web portal in the Central Europe and third belong to the top Czech lawyers) and basically all confirm this theory. I could only add that in their cases, combination of objective abilities with a unique female charm results in such a competitive advantage that men can hardly ever reach).

Information source
Ehrenberg R.G., Smith R.S. Modern Labour Economics: Theory and Public Policy. 5-th ed. – Harper Collins College Publishers, 1994.
RimTech a.s (CZ), Ringier a.s. (CZ), Novestas a.s. (CZ)