When You Discriminate, I See Opportunity: Appearance of Bias as Corroboration for Racial Cues (WITHDRAWN)

This paper explores how racial stereotypes, alongside the perceived presence or absence of prior discrimination in a candidate’s previous role, influence subsequent rehiring prospects. We argue that while immutable characteristics like race can unfairly shape perceptions of social status and worth, these negative racial biases can turn into positive cues when relevant information is taken into account. We examine this proposition in the head coach labor markets in the National Basketball Association (NBA). We discover that organizations reinterpret dismissal contexts through a racialized circumstantial lens: when a candidate's prior termination creates an appearance of possible racial biases based on statistical or taste-based discrimination, it may signal a labor market exploitation opportunity. Conversely, the absence of such biases in a candidate’s prior position exacerbates racial discrimination through stereotype confirmation. This study reframes racial discrimination as a strategic cue in human capital acquisition, revealing how employers may take advantage of labor market imperfections by exploiting the appearance of prior bias while penalizing Black candidates when such cues are absent. These findings explain the persistence of racial inequality by demonstrating how discrimination is selectively engaged as a calculated—rather than purely animus-driven—organizational practice.