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Group Inequality

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Author Info
Samuel Bowles () (Santa Fe Institute and University of Siena)
Glenn C. Loury () (Department of Economics, Brown University)
Rajiv Sethi () (Department of Economics, Barnard College, Columbia University and the Institute for Advanced Study)

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Abstract

This paper explores conditions under which inequality across social groups can emerge from initially group-egalitarian distributions and persist across generations despite equality of eco- nomic opportunity. These conditions arise from interactions among three factors: the extent of segregation in social networks, the strength of interpersonal spillovers in human capital accumu- lation, and the responsiveness of relative wages to the skill composition in production. Social segregation is critical in generating these results: group inequality cannot emerge or persist un- der conditions of equal opportunity unless segregation su¢ ciently great. We also show that if an initially disadvantaged group is su¢ ciently small, integration above a threshold level can induce both groups to invest more in human capital, while the opposite holds if the disadvantaged group is large.

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Publisher Info
Paper provided by Institute for Advanced Study, School of Social Science in its series Economics Working Papers with number 0088.

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Length: 32 pages
Date of creation: Feb 2009
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Handle: RePEc:ads:wpaper:0088

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Related research
Keywords: segregation; networks; group inequality; human capital;

Find related papers by JEL classification:
D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
Z13 - Other Special Topics - - Cultural Economics - - - Social Norms and Social Capital; Social Networks Economic Anthropology
J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Loury, Glenn C, 1998. "Discrimination in the Post-Civil Rights Era: Beyond Market Interactions," Journal of Economic Perspectives, American Economic Association, vol. 12(2), pages 117-26, Spring. [Downloadable!] (restricted)
  2. Piacentini, Mario, 2008. "Migration Enclaves, Schooling Choices and Social Mobility," MPRA Paper 8376, University Library of Munich, Germany. [Downloadable!]
  3. Rajiv Sethi & Muhamet Yildiz, 2009. "Public Disagreement," Economics Working Papers 0089, Institute for Advanced Study, School of Social Science. [Downloadable!]
  4. Mason, Patrick L., 1992. "The divide-and-conquer and employer/employee models of discrimination: neoclassical competition as a familial defect," MPRA Paper 11333, University Library of Munich, Germany. [Downloadable!]
    Other versions:
  5. Hanson, Steven D. & Robison, Lindon J., 2001. "Impacts Of Social Capital On Investment Behavior Under Risk," Staff Papers 11533, Michigan State University, Department of Agricultural, Food, and Resource Economics. [Downloadable!]
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This page was last updated on 2009-11-19.


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