Abstract:
Digital platforms and social media have fundamentally transformed how individuals signal information, while companies increasingly signal corporate sustainability by linking executive pay to ESG performance rather than solely financial metrics. Yet promises of reduced bias, enhanced accountability, and increased sustainability remain largely unfulfilled. This dissertation examines whether non-traditional information from social media can overcome entrenched discrimination and whether ESG metrics in executive compensation genuinely drive corporate sustainability.
Through large-scale field experiments and novel hand-collected data, this dissertation makes several key contributions: First, it provides causal evidence of how social media information affects discrimination in informal markets—contexts overlooked by previous research despite their critical socioeconomic role. Using randomized experiments with fictitious social media profiles, the research shows that carefully designed social media signals can eliminate ethnic discrimination. Second, it introduces visual stereotypes, causally identifying how minority stereotypes shape economic outcomes (shared housing) and social outcomes (network formation). In contrast to non-stereotypical profiles, the results indicate that stereotypical content significantly reinforces bias. Third, it reveals that personality signals of agreeableness and emotional stability significantly improve acceptance rates across contexts, while conscientiousness shows no impact. Fourth, it demonstrates that enhanced salience of information fails to mitigate discrimination. Finally, it contributes the first comprehensive hand-collected dataset on ESG metrics, their weights, and fulfillment in executive compensation.
Results from approximately 6,900 housing applications reveal persistent ethnic discrimination, with minority applicants facing 52% lower callback rates. However, social media profiles challenging stereotypes eliminate this gap, while stereotype-reinforcing profiles increase discrimination to 65%. Similar patterns emerge in the formation of personal social networks.
In corporate settings, while ESG metrics are increasingly common in executive pay, most impose negligible financial consequences, revealing widespread "window dressing" where sustainability measures carry minimal pay risk.
These findings demonstrate that introducing non-traditional information—social media signals or ESG metrics—does not automatically promote equity, accountability, or sustainability. Instead, the design, weighting, and processing of such information prove critical. The dissertation provides evidence that well-crafted interventions can reduce bias, but warns against superficial adoption of new information channels without genuine commitment to their underlying objectives.
Social Media