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Wage Discrimination When Identity Is Subjective: Evidence from Changes in Employer-Reported Race

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  • Christopher Cornwell
  • Jason Rivera
  • Ian M. Schmutte

Abstract

In Brazil, different employers report different racial classifications for the same worker. We use the variation in race across employers to estimate the relationship between race and wages. Workers whose reported race changes from nonwhite to white receive a wage increase; those who change from white to nonwhite realize a symmetric wage decrease. As much as 40 percent of the racial wage gap remains after controlling for all individual characteristics that do not change across jobs. We formally test, and reject, the hypothesis that our results are driven by misclassification. We also evaluate several mechanisms that could explain our findings.

Suggested Citation

  • Christopher Cornwell & Jason Rivera & Ian M. Schmutte, 2017. "Wage Discrimination When Identity Is Subjective: Evidence from Changes in Employer-Reported Race," Journal of Human Resources, University of Wisconsin Press, vol. 52(3), pages 719-755.
    • Handle: RePEc:uwp:jhriss:v:52:y:2017:i:3:p:719-755
    Note: DOI: 10.3368/jhr.52.3.0815-7340R1
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    Citations

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    Cited by:

    1. Nicolas Berman & Mathieu Couttenier & Victoire Girard, 2023. "Mineral Resources and the Salience of Ethnic Identities," The Economic Journal, Royal Economic Society, vol. 133(653), pages 1705-1737.
    2. Gerard, François & Lagos, Lorenzo & Severnini, Edson & Card, David, 2018. "Assortative Matching or Exclusionary Hiring? The Impact of Firm Policies on Racial Wage Differences in Brazil," CEPR Discussion Papers 13273, C.E.P.R. Discussion Papers.
    3. Andrea Moro & Peter Norman, 2019. "Endogenous Comparative Advantage," Scandinavian Journal of Economics, Wiley Blackwell, vol. 121(3), pages 1088-1124, July.
    4. Emily Nix & Nancy Qian, 2015. "The Fluidity of Race: “Passing” in the United States, 1880-1940," NBER Working Papers 20828, National Bureau of Economic Research, Inc.
    5. O’Leary, Christopher & Cravo, Túlio & Sierra, Ana Cristina & Justino, Leandro, 2021. "Effects of job referrals on labor market outcomes in Brazil," LSE Research Online Documents on Economics 123069, London School of Economics and Political Science, LSE Library.
    6. Rodrigo Zeidan & Silvio Luiz de Almeida & Inácio Bó & Neil Lewis, 2024. "Racial and income‐based affirmative action in higher education admissions: Lessons from the Brazilian experience," Journal of Economic Surveys, Wiley Blackwell, vol. 38(3), pages 956-972, July.
    7. Christopher Cornwell & Ian M. Schmutte & Daniela Scur, 2021. "Building a Productive Workforce: The Role of Structured Management Practices," Management Science, INFORMS, vol. 67(12), pages 7308-7321, December.
    8. Scur, Daniela & Schmutte, Ian & Cornwell, Christopher, 2019. "Building a productive workforce: the role of structured management," CEPR Discussion Papers 13908, C.E.P.R. Discussion Papers.
    9. Vrolijk, Kasper, 2023. "How does globalisation affect social cohesion?," IDOS Discussion Papers 5/2023, German Institute of Development and Sustainability (IDOS).
    10. Victoire Girard & Nicolas Berman & Mathieu Couttenier, 2020. "Natural resources and the salience of ethnic identities," NOVAFRICA Working Paper Series wp2007, Universidade Nova de Lisboa, Nova School of Business and Economics, NOVAFRICA.
    11. Parshakov, Petr & Gasparetto, Thadeu & Votintseva, Nadezhda & Shakina, Elena, 2024. "Beyond the pitch: Exploring the role of beauty in soccer player salaries," Journal of Economic Psychology, Elsevier, vol. 101(C).

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