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The Impact of Racial Discrimination on the Early Career Outcomes of Young Men

  • Francesco Renna

    ()

  • Randall King
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    The NLSY dataset is utilized to measure the extent of employer wage discrimination between white and black males during their first 5 years of post-school employment. We look at the respondent’s first job and the jobs 1 and 5 years after school completion. Oaxaca wage decompositions are employed to gauge the effect of discrimination. Consistent with our hypothesis, we find that the discrimination component of the wage gap falls over time. For the first job out of school the unexplained wage gap between blacks and whites is 35%. By year 5, the unexplained component falls to about 13%. Thus, while discrimination continues to play a role in explaining the white–black wage gap over time, its impact decreases as time in the labor market increases. Copyright International Atlantic Economic Society 2007

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    Article provided by International Atlantic Economic Society in its journal Atlantic Economic Journal.

    Volume (Year): 35 (2007)
    Issue (Month): 3 (September)
    Pages: 269-278

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    Handle: RePEc:kap:atlecj:v:35:y:2007:i:3:p:269-278
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    1. Joseph G. Altonji & Rebecca M. Blank, . "Race and Gender in the Labor Market," IPR working papers 98-18, Institute for Policy Resarch at Northwestern University.
    2. Bound, John & Holzer, Harry J, 1993. "Industrial Shifts, Skills Levels, and the Labor Market for White and Black Males," The Review of Economics and Statistics, MIT Press, vol. 75(3), pages 387-96, August.
    3. Joseph G. Altonji & Charles R. Pierret, . "Employer Learning and Statistical Discrimination," IPR working papers 97-18, Institute for Policy Resarch at Northwestern University.
    4. Oettinger, Gerald S, 1996. "Statistical Discrimination and the Early Career Evolution of the Black-White Wage Gap," Journal of Labor Economics, University of Chicago Press, vol. 14(1), pages 52-78, January.
    5. Oaxaca, Ronald, 1973. "Male-Female Wage Differentials in Urban Labor Markets," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 14(3), pages 693-709, October.
    6. June E. O'Neill & Dave M. O'Neill, 2005. "What Do Wage Differentials Tell Us about Labor Market Discrimination?," NBER Working Papers 11240, National Bureau of Economic Research, Inc.
    7. Zvi Eckstein & Kenneth I. Wolpin, 1999. "Estimating The Effect Of Racial Discrimination On First Job Wage Offers," The Review of Economics and Statistics, MIT Press, vol. 81(3), pages 384-392, August.
    8. Oaxaca, Ronald L. & Ransom, Michael R., 1994. "On discrimination and the decomposition of wage differentials," Journal of Econometrics, Elsevier, vol. 61(1), pages 5-21, March.
    9. Richard Startz & Lundberg, . "Private Discrimination and Social Intervention in Competitive Labor Markets," Rodney L. White Center for Financial Research Working Papers 19-81, Wharton School Rodney L. White Center for Financial Research.
    10. Becker, Gary S., 1971. "The Economics of Discrimination," University of Chicago Press Economics Books, University of Chicago Press, edition 2, number 9780226041162, May.
    11. James J. Heckman, 1998. "Detecting Discrimination," Journal of Economic Perspectives, American Economic Association, vol. 12(2), pages 101-116, Spring.
    12. William A. Darity & Patrick L. Mason, 1998. "Evidence on Discrimination in Employment: Codes of Color, Codes of Gender," Journal of Economic Perspectives, American Economic Association, vol. 12(2), pages 63-90, Spring.
    13. Shoshana Neuman & Ronald Oaxaca, 2004. "Wage Decompositions with Selectivity-Corrected Wage Equations: A Methodological Note," Journal of Economic Inequality, Springer, vol. 2(1), pages 3-10, April.
    14. Dennis J. Aigner & Glen G. Cain, 1977. "Statistical theories of discrimination in labor markets," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 30(2), pages 175-187, January.
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