"Olive, with no money to spare, looked at the man with his candy smile collecting
"Beat it buster."
So with those three words would you have a mental picture of someone who is of a lower socio economic strata and poor education.
All seems ok so far. But what if she launched into some Jewish idioms.
"Oh, so you schlep over here and take me for a schmuck. Get lost you putz."
Is this just being in character or is the stereotyping becoming offensive? The writer can convey who the character is without it turning into slander. Just remember, not all private eyes smoke cigarettes and wear trench coats and not all Muslims are terrorists.
There are plenty of movies where the Jewishness comes across and it's funny. It gives a different picture of the woman, and when she moves onto another scene we are expecting or anticipating a Jewish moment. It makes the writing richer without too much expose`
Gangster 1930's movies and noire private eye novels use language that is sometimes expected.
" Gimme the dough sis, or you're boyfriend here will get a slug, right between the eyes." We know what to expect when the character talks like this and the author's job is half done because there is a perceived shared knowledge from urban life that gangsters have a certain way of doing things. Modern gangsters would swear, have tattoos, etc. Writing a stereotype feeds the reader without a lengthy explanation.
But it doesn't have to be verbal. Any movie on a space ship is recognisable because there are always tubes, wires and blinking lights....and walkways with Shhhhsshh doors. So placing the action in a recognisable location feeds the moment.
Of course if your reader lives in a bubble then stereotyping would be no use what so ever.
Just think of a few phrases to describe people.
white shoe brigade
used car salesman
rat with a gold tooth
All these descriptions say so much more than just the name. They come with a whole picture or concept of the person.
is stereotyping a useful tool. As a writer it can be like short hand to the reader and leaves room in the writing for the action. So I would suggest it is a useful tool if used in the right places.