Wage Discrimination over the Business Cycle
AbstractUsing CPS data from 1979-2009 we examine how cyclical downturns and industry-specific demand shocks affect wage differentials between white non-Hispanic men and women, Hispanics and non-Hispanic whites, and African-Americans and non-Hispanic whites. Women's relative earnings are harmed by negative shocks; the wage disadvantage of African-Americans drops with negative shocks, which have slight negative effects on Hispanics' relative wages. Negative shocks also increase the earnings disadvantage of bad-looking workers. A theory of job search suggests two opposite-signed mechanisms that affect these wage differentials. It suggests greater absolute effects among job-movers, which is verified using the longitudinal component of the CPS.
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Bibliographic InfoPaper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 6445.
Length: 33 pages
Date of creation: Mar 2012
Date of revision:
Publication status: published in: IZA Journal of Labor Policy, 2013, 2:7
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Other versions of this item:
- E29 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Other
- J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-04-23 (All new papers)
- NEP-BEC-2012-04-23 (Business Economics)
- NEP-DEM-2012-04-23 (Demographic Economics)
- NEP-LAB-2012-04-23 (Labour Economics)
- NEP-LTV-2012-04-23 (Unemployment, Inequality & Poverty)
- NEP-MAC-2012-04-23 (Macroeconomics)
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