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Law, Probability and Risk Advance Access originally published online on June 12, 2009
Law, Probability and Risk 2009 8(2):95-117; doi:10.1093/lpr/mgp015
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© The Author [2009]. Published by Oxford University Press. All rights reserved.

Using the Peters–Belson method in equal employment opportunity personnel evaluations{dagger}

Michael D. Sinclair* and Qing Pan{ddagger}

Assistant Professor of Statistics, Statistics Department, George Washington University, 2140 Pennsylvania Ave, NW, Washington DC, USA

* Email: Michael.sinclair{at}usdoj.gov

{ddagger} Email: QPan{at}gwu.edu

Received on 30 March 2009. Revised on 24 April 2009. Accepted on 27 April 2009.


  Abstract

The Peters–Belson method has been used as an alternative approach to standard linear regression analysis to examine potential wage discrimination as it also accounts for any differences in the qualifications of the applicants. To apply the Peters–Belson method, one first conducts a regression analysis on the favoured class and applies the resulting model to the non-favoured class to identify whether this class would have received a different rate of pay if they had been treated the same as their favoured counterparts. Since this method was recently extended to explore disparities in the personnel selections via logistic regression, we will examine the general properties of this method as compared to standard regression analysis. The effects of the demographic mix and size of the applicant pool, the difference in the distribution of the qualifications and the employer's evaluation criteria on the estimated disparity will be examined. Some of the philosophical and legal issues from selected court cases surrounding the use of these two techniques will also be discussed.

Keywords: employment discrimination; logistic regression; Peters–Belson; shortfall estimates

{dagger} Presented at a workshop held at George Washington University, August 1st 2009, in honour of the 70th birthday of Joe Gastwirth, one of the founding editors of Law, Probability and Risk.

Dr. Sinclair is currently the Deputy Director of the Bureau of Justice Statistics, Office of Justice Programs, U.S. Department of Justice, and was former Director of Statistical Analyses at the U.S. Department of Labor, Office of Federal Contract Compliance Programs (OFCCP), Washington, D.C. The opinions and comments expressed herein are those of the authors and do not necessarily represent the views of the U.S. Department of Justice or the Department of Labor.


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