IDEAS home Printed from https://ideas.repec.org/p/pra/mprapa/11329.html
   My bibliography  Save this paper

Race, culture, and skill: interracial wage differentials among African Americans, Latinos, and whites

Author

Listed:
  • Mason, Patrick L.

Abstract

This article examines the interrelationships among race, culture, skill, and the distribution of wages. I utilize a three-equation system to explore this process: skill is a multidimensional productive attribute measured by years of education and work effort; educational attainment is a function of class background and individual effort; and individual wage rates are a function of skill and class background. By further assuming that effort is differentially distributed across individuals and social groups, I am able to estimate reduced form equations for educational and earnings attainment, where both equations are functions of the class backgrounds and race of individuals. The collective results of this article challenge the conventional wisdom among economists that African American and Latino job skills are of a lower quality than white job skills. To the extent that effort is an important element of worker skill, our results suggest that neither African American nor Latino labor is of lower quality than white labor. The results regarding differences between African Americans and whites in educational attainment, i.e., African Americans are able to translate a given level of resources into higher levels of educational attainment, reaffirm previous findings in the literature. The results on Latino versus white educational attainment are novel. Additionally, unlike previous research, this article connects racial differences in the skill acquisition process to the economics of discrimination.

Suggested Citation

  • Mason, Patrick L., 1997. "Race, culture, and skill: interracial wage differentials among African Americans, Latinos, and whites," MPRA Paper 11329, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:11329
    as

    Download full text from publisher

    File URL: https://mpra.ub.uni-muenchen.de/11329/1/MPRA_paper_11329.pdf
    File Function: original version
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. M. Anne Hill & June O'Neill, 1994. "Family Endowments and the Achievement of Young Children with Special Reference to the Underclass," Journal of Human Resources, University of Wisconsin Press, vol. 29(4), pages 1064-1100.
    2. Currie, J. & Thomas, D., 1995. "Nature vs. Nurture? The Bell Curve and Children's Cognitive Achievement," Papers 95-19, RAND - Labor and Population Program.
    3. R. M. Hauser & M. H. Huang, "undated". "Trends in Black-White Test-Score Differentials," Institute for Research on Poverty Discussion Papers 1110-96, University of Wisconsin Institute for Research on Poverty.
    4. O'Neill, June, 1990. "The Role of Human Capital in Earnings Differences between Black and White Men," Journal of Economic Perspectives, American Economic Association, vol. 4(4), pages 25-45, Fall.
    5. Barry T. Hirsch & Edward J. Schumacher, 1992. "Labor Earnings, Discrimination, and the Racial Composition of Jobs," Journal of Human Resources, University of Wisconsin Press, vol. 27(4), pages 602-628.
    6. Oaxaca, Ronald L. & Ransom, Michael R., 1994. "On discrimination and the decomposition of wage differentials," Journal of Econometrics, Elsevier, vol. 61(1), pages 5-21, March.
    7. B. T. Hirsch & D. A. Macpherson, "undated". "Wages, racial composition, and quality sorting in labor markets," Institute for Research on Poverty Discussion Papers 1038-94, University of Wisconsin Institute for Research on Poverty.
    8. B. T. Hirsch & D. A. Macpherson, "undated". "Wages, racial composition, and quality sorting in labor markets," Institute for Research on Poverty Discussion Papers 1038-94, University of Wisconsin Institute for Research on Poverty.
    9. Michael Boozer & Cecilia Rouse, 1995. "Intraschool Variation in Class Size: Patterns and Implications," NBER Working Papers 5144, National Bureau of Economic Research, Inc.
    10. Donohue, John J, III & Heckman, James, 1991. "Continuous versus Episodic Change: The Impact of Civil Rights Policy on the Economic Status of Blacks," Journal of Economic Literature, American Economic Association, vol. 29(4), pages 1603-1643, December.
    11. Neal, Derek A & Johnson, William R, 1996. "The Role of Premarket Factors in Black-White Wage Differences," Journal of Political Economy, University of Chicago Press, vol. 104(5), pages 869-895, October.
    12. Smith, James P, 1984. "Race and Human Capital," American Economic Review, American Economic Association, vol. 74(4), pages 685-698, September.
    13. Linda Datcher-Loury & Glenn Loury, 1986. "The Effects of Attitudes and Aspirations on the Labor Supply of Young Men," NBER Chapters, in: The Black Youth Employment Crisis, pages 377-401, National Bureau of Economic Research, Inc.
    14. Bowles, Samuel, 1972. "Schooling and Inequality from Generation to Generation," Journal of Political Economy, University of Chicago Press, vol. 80(3), pages 219-251, Part II, .
    15. Goldsmith, Arthur H & Veum, Jonathan R & Darity, William, Jr, 1997. "The Impact of Psychological and Human Capital on Wages," Economic Inquiry, Western Economic Association International, vol. 35(4), pages 815-829, October.
    16. repec:fth:prinin:344 is not listed on IDEAS
    17. Griliches, Zvi, 1977. "Estimating the Returns to Schooling: Some Econometric Problems," Econometrica, Econometric Society, vol. 45(1), pages 1-22, January.
    18. William A. Darity & Patrick L. Mason, 1998. "Evidence on Discrimination in Employment: Codes of Color, Codes of Gender," Journal of Economic Perspectives, American Economic Association, vol. 12(2), pages 63-90, Spring.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Marchenko, Anya, 2019. "The impact of host race and gender on prices on Airbnb," Journal of Housing Economics, Elsevier, vol. 46(C).
    2. Kaushik Basu & Joseph E. Stiglitz, 2016. "Inequality and Growth," World Bank Publications - Books, The World Bank Group, number 24983.
    3. Pinka Chatterji & Margarita Alegría & Mingshan Lu & David Takeuchi, 2007. "Psychiatric disorders and labor market outcomes: evidence from the National Latino and Asian American Study," Health Economics, John Wiley & Sons, Ltd., vol. 16(10), pages 1069-1090.
    4. William A. Darity & Darrick Hamilton, 2017. "The Political Economy of Education, Financial Literacy, and the Racial Wealth Gap," Review, Federal Reserve Bank of St. Louis, vol. 99(1), pages 59-76.
    5. Earnest N. Bracey, 2017. "The Significance of Historically Black Colleges and Universities (HBCUs) in the 21-super-st Century: Will Such Institutions of Higher Learning Survive?," American Journal of Economics and Sociology, Wiley Blackwell, vol. 76(3), pages 670-696, May.
    6. Nekby, Lena & Rödin, Magnus, 2010. "Acculturation identity and employment among second and middle generation immigrants," Journal of Economic Psychology, Elsevier, vol. 31(1), pages 35-50, February.
    7. Marcos Rangel, 2015. "Is Parental Love Colorblind? Human Capital Accumulation within Mixed Families," The Review of Black Political Economy, Springer;National Economic Association, vol. 42(1), pages 57-86, June.
    8. Lu Fan & Swarn Chatterjee & Jinhee Kim, 2022. "An Integrated Framework of Young Adults’ Subjective Well-Being: The Roles of Personality Traits, Financial Responsibility, Perceived Financial Capability, and Race," Journal of Family and Economic Issues, Springer, vol. 43(1), pages 66-85, March.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Patrick Mason, 1997. "Race, culture, and skill: Interracial wage differences among African Americans, Latinos, and whites," The Review of Black Political Economy, Springer;National Economic Association, vol. 25(3), pages 5-39, March.
    2. Barry T. Hirsch & David A. Macpherson, 2004. "Wages, Sorting on Skill, and the Racial Composition of Jobs," Journal of Labor Economics, University of Chicago Press, vol. 22(1), pages 189-210, January.
    3. Celeste K. Carruthers & Marianne H. Wanamaker, 2017. "Separate and Unequal in the Labor Market: Human Capital and the Jim Crow Wage Gap," Journal of Labor Economics, University of Chicago Press, vol. 35(3), pages 655-696.
    4. Judith K. Hellerstein & David Neumark, 2008. "Workplace Segregation in the United States: Race, Ethnicity, and Skill," The Review of Economics and Statistics, MIT Press, vol. 90(3), pages 459-477, August.
    5. Mason, Patrick, 2007. "Intergenerational mobility and interraical inequality:the return to family values," MPRA Paper 11327, University Library of Munich, Germany.
    6. Shoshana Neuman & Ronald L. Oaxaca, 2005. "Wage differentials in the 1990s in Israel: endowments, discrimination, and selectivity," International Journal of Manpower, Emerald Group Publishing Limited, vol. 26(3), pages 217-236, April.
    7. Roland G. Fryer, Jr. & Devah Pager & Jörg L. Spenkuch, 2013. "Racial Disparities in Job Finding and Offered Wages," Journal of Law and Economics, University of Chicago Press, vol. 56(3), pages 633-689.
    8. Patrick Bayer & Kerwin Kofi Charles, 2016. "Divergent Paths: Structural Change, Economic Rank, and the Evolution of Black-White Earnings Differences, 1940-2014," NBER Working Papers 22797, National Bureau of Economic Research, Inc.
    9. David Neumark & Harry Holzer, 2000. "Assessing Affirmative Action," Journal of Economic Literature, American Economic Association, vol. 38(3), pages 483-568, September.
    10. Huoying Wu, 2007. "Can The Human Capital Approach Explain Life‐Cycle Wage Differentials Between Races And Sexes?," Economic Inquiry, Western Economic Association International, vol. 45(1), pages 24-39, January.
    11. Stephen L. Ross, 2003. "What Is Known about Testing for Discrimination: Lessons Learned by Comparing across Different Markets," Working papers 2003-21, University of Connecticut, Department of Economics, revised Nov 2003.
    12. John J. Donohue III, 2005. "The Law and Economics of Antidiscrimination Law," NBER Working Papers 11631, National Bureau of Economic Research, Inc.
    13. Eric A. Hanushek & Victor Lavy & Kohtaro Hitomi, 2008. "Do Students Care about School Quality? Determinants of Dropout Behavior in Developing Countries," Journal of Human Capital, University of Chicago Press, vol. 2(1), pages 69-105.
    14. O'Neill, June Ellenoff, 2005. "Comments on "Is there racism in economic research?"," European Journal of Political Economy, Elsevier, vol. 21(3), pages 775-780, September.
    15. Lex Borghans & Bas Ter Weel & Bruce A. Weinberg, 2014. "People Skills and the Labor-Market Outcomes of Underrepresented Groups," ILR Review, Cornell University, ILR School, vol. 67(2), pages 287-334, April.
    16. Jean-Baptiste Vilain, 2018. "Three essays in applied economics [Trois essais en économie appliquée]," SciencePo Working papers Main tel-03419493, HAL.
    17. Hübler, Olaf, 2003. "Geschlechtsspezifische Lohnunterschiede (Gender-specific wage differentials)," Mitteilungen aus der Arbeitsmarkt- und Berufsforschung, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany], vol. 36(4), pages 539-559.
    18. Jonathan B. Berk, 1999. "Statistical Discrimination in a Competitive Labor Market," NBER Working Papers 6871, National Bureau of Economic Research, Inc.
    19. Roland G. Fryer, Jr, 2010. "Racial Inequality in the 21st Century: The Declining Significance of Discrimination," NBER Working Papers 16256, National Bureau of Economic Research, Inc.
    20. Neal, Derek A & Johnson, William R, 1996. "The Role of Premarket Factors in Black-White Wage Differences," Journal of Political Economy, University of Chicago Press, vol. 104(5), pages 869-895, October.

    More about this item

    Keywords

    African American; Latino; Hispanic; discrimination; culture; social capital; culture; effort; education; skill;
    All these keywords.

    JEL classification:

    • Z1 - Other Special Topics - - Cultural Economics
    • J15 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Minorities, Races, Indigenous Peoples, and Immigrants; Non-labor Discrimination
    • J7 - Labor and Demographic Economics - - Labor Discrimination

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:11329. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Joachim Winter (email available below). General contact details of provider: https://edirc.repec.org/data/vfmunde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.