Abstract:Employment discrimination is widespread in the economic practice of various countries, and its negative impact on high-quality economic development has attracted much attention. However, existing research focuses more on the impact of employment discrimination on the income distribution of residents, and less on its impact on the effectiveness of economic policies. The labor market is one of the important channels for monetary policy to affect the macro economy. Employment discrimination may change the macroeconomic effect of monetary policy by affecting the labor market. In the real economy, there are many forms of employment discrimination, among which employment opportunity discrimination is the most common phenomenon. That is to say, in the recruitment process, enterprises subjectively determine that hiring a certain type of labor force will incur additional costs, resulting in the employment of this type of labor force being less than the optimal amount of employment, thereby reducing the total amount of social employment. Based on this, this paper constructs a dynamic stochastic general equilibrium without employment discrimination and a two-subject dynamic stochastic general equilibrium (TANK-DSGE) model with employment discrimination, and uses impulse response analysis and second-order moment matching method to investigate the impact of employment discrimination on the macroeconomic effects of monetary policy. The analysis shows that no matter what kind of monetary policy (Standard Taylor Rule, Employment-expanding Taylor Rule, and Peg-to-average Inflation Monetary Policy) is implemented by monetary policy authorities and whether there is employment discrimination or not, expansionary monetary policy promotes the growth of macroeconomic variables such as output, consumption, investment, employment, physical capital rent rate, and overall price levels; compared with the situation without employment discrimination, in the presence of employment discrimination, the expansionary monetary policy has a smaller role in promoting output, consumption, investment, and employment, and a larger role in promoting price increases (inflation). That is, employment discrimination weakens the positive effects of expansionary monetary policy and strengthens its negative effects; the existence of employment discrimination will reduce the persistence of output and employment after the implementation of monetary policy, increase the persistence of inflation, and also increase the volatility of output, employment and inflation. Generally speaking, the promotion effect of expansionary monetary policy on employment is the strongest under the employment-expanding Taylor rule, and the negative impact of employment discrimination is the least, so choosing the employment-expanding Taylor rule can better achieve the goal of promoting employment; the boosting effect of expansionary monetary policy on output is strongest under the monetary policy pegging to the average inflation, and the negative impact of employment discrimination is the least, so choosing the monetary policy of pegging to the average inflation can better achieve the goal of promoting output growth. Compared with the existing literature, this paper mainly expands and deepens this study in three aspects: one is to explore the negative impact of employment discrimination on high-quality economic development from the perspective of economic policy effectiveness, the second is to construct a TANK-DSGE model to investigate the impact of employment discrimination on the macroeconomic effect of monetary policy, and the third is to provide theoretical reference for monetary policy choices under different macroeconomic objectives from the perspective of improving policy effectiveness. This paper reveals the negative impact of employment discrimination on the macroeconomic effects of monetary policy. Reducing employment discrimination not only contributes to employment and income equity, but also to improving the effectiveness of economic policies. Therefore, it is necessary to construct and improve a unified labor market to continuously reduce all kinds of employment discrimination.