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Racial Wage Discrimination and Industrial Structure

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  • William R. Johnson

Abstract

This paper estimates racial wage discrimination by industry with a large sample of data on individual worker characteristics, industry of employment, and wages. Governments, regulated industries, and nonprofit organizations as a group discriminate less in wages than other employers, though much of the difference is due to the behavior of the government as the employer. These results appear to contradict the employer-taste models of discrimination associated with Becker and Alchian-Kessel, which assert that cost-minimizing employers will discriminate less than employers not under strict cost-minimizing discipline. However, it is argued that these models are not theories of wage discrimination, but rather of employment discrimination by firms. An alternative hypothesis is proposed in which only employers free of cost-minimizing constraints can afford to pay blacks more than the possibly discriminatory market wage for blacks. These firms are likely, also, to be subject to the greatest pressures from government antidiscrimination policy.

Suggested Citation

  • William R. Johnson, 1978. "Racial Wage Discrimination and Industrial Structure," Bell Journal of Economics, The RAND Corporation, vol. 9(1), pages 70-81, Spring.
    • Handle: RePEc:rje:bellje:v:9:y:1978:i:spring:p:70-81
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    Cited by:

    1. Dex S., 1992. "Costs of discriminating against migrant workers : an international review," ILO Working Papers 992869403402676, International Labour Organization.
    2. repec:mse:cesdoc:09059r is not listed on IDEAS
    3. Mora, Jhon James & Arcila, Andrés Mauricio, 2014. "Brechas salariales por etnia y ubicación geográfica en Santiago de Cali || Wage Gap by Geographic Location and Ethnicity in Cali (Colombia)," Revista de Métodos Cuantitativos para la Economía y la Empresa = Journal of Quantitative Methods for Economics and Business Administration, Universidad Pablo de Olavide, Department of Quantitative Methods for Economics and Business Administration, vol. 18(1), pages 34-53, December.
    4. Jacqueline Agesa & Kristen Monaco, 2006. "The Decreasing Influence Of Domestic Market Structure On Racial Earnings Differentials: 1984 To 1996," Contemporary Economic Policy, Western Economic Association International, vol. 24(2), pages 224-236, April.
    5. Jacqueline Agesa & Richard U. Agesa, 2012. "Imports, unionization and racial wage discrimination in the US," Applied Economics, Taylor & Francis Journals, vol. 44(3), pages 339-350, January.
    6. Clémence Berson, 2016. "Private Versus Public Sector Wage Gap: Does Origin Matter?," Metroeconomica, Wiley Blackwell, vol. 67(4), pages 717-741, November.
    7. repec:ilo:ilowps:286940 is not listed on IDEAS
    8. Azim Essaji & Gregory Sweeney & Alexandros Kotsopoulos, 2010. "Equality through exposure to imports? International trade and the racial wage gap," Journal of Economic Policy Reform, Taylor & Francis Journals, vol. 13(4), pages 313-323.
    9. John Heywood, 1988. "Market structure and the pattern of black-owned firms," The Review of Black Political Economy, Springer;National Economic Association, vol. 16(4), pages 65-76, March.
    10. Mary E. Graham & Julie L. Hotchkiss, 2008. "Elimination of gender-related employment disparities through statistical process control," FRB Atlanta Working Paper 2008-24, Federal Reserve Bank of Atlanta.
    11. Marcus Alexis & Marshall Medoff, 1984. "Becker’s utility approach to discrimination: A review of the issues," The Review of Black Political Economy, Springer;National Economic Association, vol. 12(4), pages 41-58, March.
    12. Carlos G. Ospino & Paola Roldán Vasquez & Nacira Barraza Narváez, 2010. "Oaxaca-Blinder wage decomposition: Methods, critiques and applications. A literature review," Revista de Economía del Caribe 7807, Universidad del Norte.
    13. repec:eee:labchp:v:2:y:1986:i:c:p:1139-1181 is not listed on IDEAS

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