IDEAS home Printed from https://ideas.repec.org/p/mtk/febawb/57.html

Racial Differences In Availability Of Fringe Benefits As An Explanation For The Unexplained Blackwhite Wage Gap For Males In Us

Author

Listed:
  • Kristjan-Olari Leping

Abstract

The US black-white wage gap is an issue that has attracted thorough investigation, but so far the corresponding gap for fringe benefits has not received sufficient attention. Although ethnic differences in fringe benefits could affect wage differences, previous analysis of ethnic wage gaps in the vast majority of cases has not taken fringe benefits into account. In order to fill that gap in the existing literature, this article estimates the black-white gap for both wages and fringe benefits on the basis of US data. Data from the 2004 section of the National Longitudinal Survey of Youth 1979 has been used in this analysis. Our results indicate that when controlling for various individual and job characteristics, there remains a wage gap in favour of whites, and for several fringe benefits, there is an unexplained gap in favour of blacks. This result means that the ethnic wage gap overestimates the ethnic compensation gap. We also argue that fringe benefits are used to compensate blacks for their lower wages.

Suggested Citation

  • Kristjan-Olari Leping, 2007. "Racial Differences In Availability Of Fringe Benefits As An Explanation For The Unexplained Blackwhite Wage Gap For Males In Us," University of Tartu - Faculty of Economics and Business Administration Working Paper Series 57, Faculty of Economics and Business Administration, University of Tartu (Estonia).
    • Handle: RePEc:mtk:febawb:57
    as

    Download full text from publisher

    File URL: https://mjtoimetised.ut.ee/febpdf/febawb57.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. David Collard & Michael Godwin & John Hudson, 2005. "The Provision of Company Benefits in the UK," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 32(7-8), pages 1397-1421.
    2. David Card & Alan B. Krueger, 1992. "School Quality and Black-White Relative Earnings: A Direct Assessment," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 107(1), pages 151-200.
    3. 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.
    4. David Collard & Michael Godwin & John Hudson, 2005. "The Provision of Company Benefits in the UK," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 32(7‐8), pages 1397-1421, September.
    5. 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.
    6. Greg J. Duncan, 1976. "Earnings Functions and Nonpecuniary Benefits," Journal of Human Resources, University of Wisconsin Press, vol. 11(4), pages 462-483.
    7. Richard B. Freeman, 1981. "The Effect of Unionism on Fringe Benefits," ILR Review, Cornell University, ILR School, vol. 34(4), pages 489-509, July.
    8. Brown, Charles & Medoff, James, 1989. "The Employer Size-Wage Effect," Journal of Political Economy, University of Chicago Press, vol. 97(5), pages 1027-1059, October.
    9. Altonji, Joseph G. & Blank, Rebecca M., 1999. "Race and gender in the labor market," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 48, pages 3143-3259, Elsevier.
    10. Kahneman, Daniel & Knetsch, Jack L & Thaler, Richard H, 1990. "Experimental Tests of the Endowment Effect and the Coase Theorem," Journal of Political Economy, University of Chicago Press, vol. 98(6), pages 1325-1348, December.
    11. Brooks Pierce, 2001. "Compensation Inequality," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 116(4), pages 1493-1525.
    12. Becker, Gary S., 1971. "The Economics of Discrimination," University of Chicago Press Economics Books, University of Chicago Press, edition 2, number 9780226041162, October.
    13. William Rodgers & William Spriggs, 1996. "What does the AFQT really measure: Race, wages, schooling and the AFQT score," The Review of Black Political Economy, Springer;National Economic Association, vol. 24(4), pages 13-46, June.
    14. Dan Black & Amelia Haviland & Seth Sanders & Lowell Taylor, 2006. "Why Do Minority Men Earn Less? A Study of Wage Differentials among the Highly Educated," The Review of Economics and Statistics, MIT Press, vol. 88(2), pages 300-313, May.
    15. Jayachandran N. Variyam & David S. Kraybill, 1998. "Fringe Benefits Provision by Rural Small Businesses," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 80(2), pages 360-368.
    16. John W. Budd, 2004. "Non-Wage Forms of Compensation," Journal of Labor Research, Transaction Publishers, vol. 25(4), pages 597-622, October.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Kevin F. Hallock & Xin Jin & Michael Waldman, 2022. "The total compensation gap, wage gap and benefit gap between workers with and without a disability," British Journal of Industrial Relations, London School of Economics, vol. 60(1), pages 3-31, March.
    2. Helen Levy, 2006. "Health Insurance and the Wage Gap," NBER Working Papers 11975, National Bureau of Economic Research, Inc.
    3. Francesco Renna & Randall King, 2007. "The Impact of Racial Discrimination on the Early Career Outcomes of Young Men," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 35(3), pages 269-278, September.
    4. Castro Campos, Bente, 2013. "Human capital differences or labor market discrimination? The occupational outcomes of ethnic minorities in rural Guizhou (China)," Studies on the Agricultural and Food Sector in Transition Economies, Leibniz Institute of Agricultural Development in Transition Economies (IAMO), volume 73, number 73.
    5. repec:eee:labchp:v:3:y:1999:i:pc:p:3143-3259 is not listed on IDEAS
    6. Audrey Light & Alita Nandi, 2007. "Identifying race and ethnicity in the 1979 National Longitudinal Survey of Youth," Population Research and Policy Review, Springer;Southern Demographic Association (SDA), vol. 26(2), pages 125-144, April.
    7. Romain Aeberhardt & Élise Coudin & Roland Rathelot, 2017. "The heterogeneity of ethnic employment gaps," Journal of Population Economics, Springer;European Society for Population Economics, vol. 30(1), pages 307-337, January.
    8. Dueñas, Diego & Iglesias, Carlos & Llorente, Raquel, 2016. "¿Por qué las mujeres no se distribuyen de forma homogénea en el mercado de trabajo español? El “efecto rechazo” y el “efecto atracción”," El Trimestre Económico, Fondo de Cultura Económica, vol. 83(330), pages .339-369, abril-jun.
    9. Kaltenberg, Mary & Foster-McGregor, Neil, 2020. "The impact of automation on inequality across Europe," MERIT Working Papers 2020-009, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    10. David Neumark & Wendy A. Stock, 2001. "The Effects of Race and Sex Discrimination Laws," NBER Working Papers 8215, National Bureau of Economic Research, Inc.
    11. O B Bodvarsson & John Sessions, 2010. "Nationality Discrimination in the Labor Market: Theory and Test," Department of Economics Working Papers 8/10, University of Bath, Department of Economics.
    12. Francesco Pastore & Izabela Marcinkowska, 2004. "The Gender Wage Gap Among Young People in Italy," CELPE Discussion Papers 82, CELPE - CEnter for Labor and Political Economics, University of Salerno, Italy.
    13. Gabin Langevin & David Masclet & Fabien Moizeau & Emmanuel Peterlé, 2013. "Educational Attainment, Wages and Employment of Second-Generation Immigrants in France," CIRANO Working Papers 2013s-33, CIRANO.
    14. Barr & Oduro, Abena, 2000. "Ethnicity and wage determination in Ghana," Policy Research Working Paper Series 2506, The World Bank.
    15. Judith K. Hellerstein & David Neumark, 2008. "Workplace Segregation in the United States: Race, Ethnicity, and Skill," The Review of Economics and Statistics, MIT Press, vol. 90(3), pages 459-477, August.
    16. David Bjerk, 2007. "The Differing Nature of Black-White Wage Inequality Across Occupational Sectors," Journal of Human Resources, University of Wisconsin Press, vol. 42(2).
    17. Hübler, Olaf, 2003. "Geschlechtsspezifische Lohnunterschiede (Gender-specific wage differentials)," Mitteilungen aus der Arbeitsmarkt- und Berufsforschung, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany], vol. 36(4), pages 539-559.
    18. Sami Napari, 2006. "The Early Career Gender Wage Gap," CEP Discussion Papers dp0738, Centre for Economic Performance, LSE.
    19. Reimer, David & Schröder, Jette, 2006. "Tracing the gender wage gap: Income differences between male and female university graduates in Germany," Zeitschrift für ArbeitsmarktForschung - Journal for Labour Market Research, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany], vol. 39(2), pages 235-253.
    20. Kenneth A. Couch & Mary Daly, 2003. "The Improving Relative Status of Black Men," Journal of Income Distribution, Ad libros publications inc., vol. 12(3-4), pages 4-4, September.
    21. David McClough & Mary Ellen Benedict, 2017. "Not All Education Is Created Equal: How Choice of Academic Major Affects the Racial Salary Gap," The American Economist, Sage Publications, vol. 62(2), pages 184-205, October.

    More about this item

    Keywords

    ;
    ;
    ;

    JEL classification:

    • J15 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Minorities, Races, Indigenous Peoples, and Immigrants; Non-labor Discrimination
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J33 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Compensation Packages; Payment Methods

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:mtk:febawb:57. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Liis Roosaar (email available below). General contact details of provider: https://edirc.repec.org/data/febutee.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.