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Empirical Studies of Current Trends in Racial Inequality

Paper Session

Sunday, Jan. 7, 2018 8:00 AM - 10:00 AM

Marriott Philadelphia Downtown, Meeting Room 404
Hosted By: National Economic Association & Union for Radical Political Economics
  • Chair: John Schmitt, Washington Center for Equitable Growth

Revising The Racial Wage Gap Among Men: The Role Of Non-employment And Incarceration

Jeannette Wicks-Lim
,
University of Massachusetts-Amherst

Abstract

The conventional wage gap measure underestimates the impact of racism in the U.S. labor market. This is because the conventional measure of racial wage disparity, which compares the average hourly wage rate of employed workers by race, excludes an expanding share of the population: prime working-age men (25-54 years old) who are disconnected from the formal labor market. This trend that has been severe for black men, and young black men, in particular, relative to white men due, in part, to the surge in incarceration rates. The exclusion of this growing group of non-working men biases our estimates of racial disparity because non-working or unemployed prime working-age men tend to fare poorly in the labor market when they are employed – a feature that cannot be captured by looking at the earnings of employed workers alone. The objective of this research is to generate a racial disparity measure that reflects the full range of labor market experiences of prime-working age men, including the earnings potential of the non-employed. The revised racial wage gap I estimate reveals a much wider racial wage gap than standard measures, and indicates that the ability of Black men to rely on the formal labor market to earn a living has considerably deteriorated since the early 1980s. This trend has been driven by a faster increase in the number and duration of employment gaps among Black men compared to White men, along with the rise in mass incarceration.

Revisiting Bergmann’s Occupational Crowding Model

Michelle Holder
,
City University of New York

Abstract

In 1971 economist Barbara Bergmann’s developed the “occupational crowding model,” which posits that black men are “crowded into” low-wage occupations and “crowded out” of high-wage occupations. Utilizing a theory put forth by Francis Y. Edgeworth in 1922, who was building on work done by Millicent Fawcett in 1892 on why women received lower pay compared to men, Bergmann hypothesized that black men were “crowded” into low-wage, less desirable occupations compared to their white male counterparts due to discriminatory action on the part of employers. In quantitative analysis I’ve conducted for the years 2013 through 2014 my results have yielded a different picture from what Bergmann’s model predicts for the demographic composition of the low-wage labor force; while African American men are indeed underrepresented in high-wage occupations, consistent with the crowding model, of the seven major low wage occupational categories this group is overrepresented, or “crowded,” in only three of them. I attribute this to changes in the demographic makeup of the U.S. labor force-- specifically the higher shares of both women as well as non-black non-citizens in the workforce now compared to 46 years ago--since Bergmann first conceptualized the crowding model. I conclude by suggesting that the model may now require further specification to reflect an increasingly complex American workforce instead of the more binary (e.g. black and white, more men and fewer women, etc.) one which existed at the time Bergmann developed her still relevant model.

Racial Differences in Labor Force Participation Since the Great Recession: What's Happening?

Thomas Masterson
,
Levy Economics Institute of Bard College

Abstract

Since the Great Recession, recovery in labor force participation rates has been sluggish overall. African Americans and Latinos participation rates have increased noticeably since the labor market bottomed out in 2010, while that of the rest of the population has been flat. This is a pattern unlike what we've seen in previous recoveries. We examine the causes of this differential recovery using CPS data from 2007, 2010 and 2015.

The Color of Wealth: Evidence Across United States Cities

Mark Paul
,
Duke University
Darrick Hamilton
,
New School
William A. Darity Jr.
,
Duke University

Abstract

There is a well documented racial wealth gap in the United States at the national level, however there is limited data on wealth by region or disaggregated by race and ethnicity. This paper presents new evidence on the racial wealth gap in five major metropolitan areas across the United States using an original dataset known as the National Asset Scorecard for Communities of Color. The data provides a detailed look into net worth for households, showing significant heterogeneity by region and ethnicity. The data support the national findings that there exists a persistent, and large, racial wealth gap. The level of detail provides new evidence into how various groups are able to accumulate wealth, or not, under different scenarios. Further, the data indicate that while education is correlated with improve wealth outcomes for some groups, it is not a “silver bullet” to close the racial wealth gap. The paper concludes with an offering of bold policies to address the racial wealth gap.
Discussant(s)
Valerie Wilson
,
Economic Policy Institute
Ngina Chiteji
,
New York University
JEL Classifications
  • J1 - Demographic Economics