"Soft" Skills, "Hard" Skills, and the Black/White Earnings Gap

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"Soft" Skills, "Hard" Skills, and the Black/White Earnings Gap

Author Info

C. Simon Fan () (Lingnan University, Hong Kong)
Xiangdong Wei () (Lingnan University, Hong Kong)
Junsen Zhang () (Chinese University of Hong Kong and IZA Bonn)

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Abstract

This paper provides both a theoretical and an empirical investigation into the impact of job skill types on the black/white pay differentials. The theoretical analysis derives that the more intensively "soft"/"hard" skills are used in an occupation, the greater/smaller the black/white pay differential is there in that occupation. Moreover, in response to the differential pay gaps across jobs requiring different levels of "soft"/"hard" skills, blacks are more likely to self-select themselves into the jobs that use "hard" skills more intensively, ceteris paribus. Using NLSY data, we find consistent empirical evidence to our theoretical predictions. Hence, the paper bridges the existing literature on racial pay gaps and cognitive vs. non-cognitive skills by explicitly testing the impact of job skill types on racial pay gaps.

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Publisher Info
Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 1804.

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Length: 25 pages
Date of creation: Oct 2005
Date of revision:
Handle: RePEc:iza:izadps:dp1804

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Find related papers by JEL classification:
J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing

This paper has been announced in the following NEP Reports:

NEP-ALL-2005-10-29 (All new papers)
NEP-LAB-2005-10-29 (Labour Economics)
NEP-SOC-2005-10-29 (Social Norms & Social Capital)

References listed on IDEAS
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(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.)

Michael Rosholm & Marianne Røed & Pål Schøne, 2006. "Are New Work Practices and New Technologies Biased against Immigrant Workers?," IZA Discussion Papers 2135, Institute for the Study of Labor (IZA). [Downloadable!]

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