Discrimination on various fronts has been a hot debate in the US since the end of slave trade and in the years following the subsequent passage of the law abolishing slave trade. Despite the progress made in ensuring equity among all races in the US, substantial gaps remain in…
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The sample size is 4492. The paper will also investigate possible reasons for the disparity in earnings- whether it is due to skills or discrimination. Regression models will be used to analyze the role of race in wage differentials. We then review the principle models of racial discrimination in the labor market and discuss their ability to explain the observed differences. When possible, the paper will also look for additional models derived from economic theories and ask whether those predictions are consistent with the data used for this study.
Decades of racial and gender studies have led some investigators and policymakers to believe that discrimination occurs in the US labor market to higher magnitude than is known today. Indeed, in the US, blacks have lower earnings in comparison to whites and are under-represented in jobs involving interaction with clientele (Barrow 15). The wage gap between whites and blacks is substantial in the US, and has been a significant concern among policymakers and for the last five decades. Some people have pointed out that this perceived gap is due to racial differences in skills. However, even when individual characteristics in human capital, ability, or other market productivity traits are controlled, statistical analyses show a significant wage gap between whites and blacks. The evidence points to an important role for labor-market discrimination in producing the residual earning gaps.
Discrimination has been observed to be not only racial, but it is also as a result of gender. Women are paid less than their male colleagues of equal academic and professional qualifications. Wages differences between men and women are explained by the differences in the technical fields commonly studied by men. Partially, wage disparities among gender explained by occupational segregation between women and men. Studies have found that averagely, men with equal academic and training experience earn 10 % more than women
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(“Wage Differentials:Black-White Statistics Project”, n.d.)
Retrieved from https://studentshare.org/macro-microeconomics/1610032-wage-differentialsblack-white
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