We use a simple model of statistical discrimination to empirically disentangle two different sources of racial wage inequality: differences in the distribution of pre-market factors that affect human capital, and differences in incentives to acquire human capital when young. We show how the equilibrium restrictions from the model help us identify such factors. We estimate the parameters of the model using NLSY data on wage, education, and AFQT test scores.
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Paper provided by Society for Economic Dynamics in its series 2004 Meeting Papers with number
248.
Length: Date of creation: 2004 Date of revision: Handle: RePEc:red:sed004:248
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