Principles of Economics- Mankiw (5th) 416

Principles of Economics- Mankiw (5th) 416 - 428 PA R T S I...

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428 PART SIX THE ECONOMICS OF LABOR MARKETS CASE STUDY SEGREGATED STREETCARS AND THE PROFIT MOTIVE In the early twentieth century, streetcars in many southern cities were segre- gated by race. White passengers sat in the front of the streetcars, and black pas- sengers sat in the back. What do you suppose caused and maintained this discriminatory practice? And how was this practice viewed by the firms that ran the streetcars? In a 1986 article in the Journal of Economic History, economic historian Jen- nifer Roback looked at these questions. Roback found that the segregation of races on streetcars was the result of laws that required such segregation. Before these laws were passed, racial discrimination in seating was rare. It was far more common to segregate smokers and nonsmokers. Moreover, the firms that ran the streetcars often opposed the laws requiring racial segregation. Providing separate seating for different races raised the firms’ costs and reduced their profit. One railroad company manager com-
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This note was uploaded on 07/30/2010 for the course ECON 120 taught by Professor Abijian during the Spring '10 term at Mesa CC.

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