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Does a Foot in the Door Matter? White–Nonwhite Differences in the Wage Return to Tenure and Prior Workplace Experience

Author

Listed:
  • Arthur H. Goldsmith

    () (Department of Economics, Washington and Lee University)

  • Darrick Hamilton

    () (Milano-The New School of Management and Urban Policy)

  • William Darity Jr

    () (Department of Economics, University of North Carolina at Chapel Hill)

Abstract

The theory of ability misperception posits that employers will offer greater rewards to whites than nonwhites for similar levels of prior experience (Proposition 1) but that racial/ethnic differences in the return to additional tenure or seniority with the current employer will be smaller (Proposition 2). To advance the existing empirical literature, this paper evaluates the validity of these propositions by using data on black, Latino, and white workers drawn from the Multi-City Study of Urban Inequality. The analysis is conducted separately for women and men and controls for a wider range of workplace setting descriptors than was used in previous studies. Our results offer support for Proposition 1 and for Proposition 2. We find that nonwhites, regardless of job setting, receive relatively poor returns to prior workplace experience (the lone exception is Latinas). Second, nonwhites typically receive greater wage gains for accumulating additional tenure than whites.

Suggested Citation

  • Arthur H. Goldsmith & Darrick Hamilton & William Darity Jr, 2006. "Does a Foot in the Door Matter? White–Nonwhite Differences in the Wage Return to Tenure and Prior Workplace Experience," Southern Economic Journal, Southern Economic Association, vol. 73(2), pages 267-306, October.
  • Handle: RePEc:sej:ancoec:v:73:2:y:2006:p:267-306
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    References listed on IDEAS

    as
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    Cited by:

    1. Roland G. Fryer, Jr. & Devah Pager & Jörg L. Spenkuch, 2013. "Racial Disparities in Job Finding and Offered Wages," Journal of Law and Economics, University of Chicago Press, vol. 56(3), pages 633-689.
    2. Peter Blair & Bobby Chung, 2017. "Occupational Licensing Reduces Racial and Gender Wage Gaps: Evidence from the Survey of Income and Program Participation," Working Papers 2017-50, Human Capital and Economic Opportunity Working Group.

    More about this item

    JEL classification:

    • 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

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