Lecture 20 - Lecture 20 Lecture 20 Gender, Race, and...

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ecture 20 Lecture 20 Gender, Race, and Ethnicity in the Labor Market II
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oadmap Roadmap everse regression Reverse regression • Racial wage gaps • The Black/White wage gap over time • Explaining the gaps • Theories of discrimination egislation Legislation
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Reverse regression (used in court cases) Compare these two statements: 1.Among college graduates blacks make less than whites. 2.Among high earners blacks have less education than whites. What conclusions might you draw from each? – Are these conflicting accounts? • No. if blacks have less education on average, then e would expect that among highly paid workers we would expect that among highly paid workers, blacks have less education.
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Example • Suppose there are three education levels (HS, BA/BS, and MA) • Ten percent of white workers have an MA, ut no black workers have an MA but no black workers have an MA. • Both black and white workers have HS, and A/BS BA/BS. • If all workers with at least a BA/BS are high earners, then among whites average education will be higher than for blacks. – This has nothing to do with preferential treatment.
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Employment Ratios, Labor Force Participation Rates, and nemployment Rates by Race and Gender * 1970 005 Unemployment Rates, by Race and Gender,* 1970-2005
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atio of black to white unemployment Ratio of black to white unemployment lacks appear to be “Last hired first fired” so Blacks appear to be Last hired first fired , so they are disproportionately hurt in cessions recessions. • This ratio is roughly 2-to-1. • Consider the implications of the “discouraged worker” effect.
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- Wage gaps over time B W Wage gaps over time Decline in employment: Rapid gains during 1940-1950 Slow catch-up during1960-1980 war on drugs Stagnation after 80s
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Explanations for decline in gap Initial reduction in the gap (between 1940 and 1950) came from: – (1) Movement of blacks from the south to the north during the 40s. – (2) Rebound from the great depression (the last hired first fired) The wage convergence of the 1960s and 1970s has been attributed to: – (1) Improvements in the quality of schools attended by blacks – (2) The enactment of antidiscrimination legislation (Civil Rights act 1964, Federal Contract Compliance Program 1965) The slowdown in convergence during the 1980s and 1990s has been attributed to: – (1) Racial differences in the levels and returns to observed and unobserved skill.
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Lecture 20 - Lecture 20 Lecture 20 Gender, Race, and...

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