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Meritocracy in America: An Examination of Wages Within and Across Occupations

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  • John Cawley
  • James Heckman
  • Edward Vytlacil

Abstract

In The Bell Curve, Herrnstein and Murray argue that the U.S. economy is a meritocracy in which differences in wages (including differences across race and gender) are explained by differences in cognitive ability. In this paper we test their claim for wages conditional on occupation using a simultaneous model of occupation choice and wage determination. Our results contradict Herrnstein and Murray's claim that the U.S. labor market operates only on meritocratic principles.

Suggested Citation

  • John Cawley & James Heckman & Edward Vytlacil, 1998. "Meritocracy in America: An Examination of Wages Within and Across Occupations," NBER Working Papers 6446, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:6446
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    References listed on IDEAS

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    1. Heckman, James & Singer, Burton, 1984. "A Method for Minimizing the Impact of Distributional Assumptions in Econometric Models for Duration Data," Econometrica, Econometric Society, vol. 52(2), pages 271-320, March.
    2. James Heckman & Jose Scheinkman, 1987. "The Importance of Bundling in a Gorman-Lancaster Model of Earnings," Review of Economic Studies, Oxford University Press, vol. 54(2), pages 243-255.
    3. Heckman, James J, 1995. "Lessons from the Bell Curve," Journal of Political Economy, University of Chicago Press, vol. 103(5), pages 1091-1120, October.
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    Cited by:

    1. Erik Plug & Wim Vijverberg, 2003. "Schooling, Family Background, and Adoption: Is It Nature or Is It Nurture?," Journal of Political Economy, University of Chicago Press, vol. 111(3), pages 611-641, June.
    2. Joseph K. Kaboski, 2009. "Education, Sectoral Composition and Growth," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 12(1), pages 168-182, January.
    3. Veenman, J. & Heij, C., 2008. "Immigrant gender convergence in education and on the labor market," Econometric Institute Research Papers EI 2008-16, Erasmus University Rotterdam, Erasmus School of Economics (ESE), Econometric Institute.
    4. Liang Zhao & Joyce P. Jacobsen, 2006. "Revisiting The Bell Curve Debate Regarding the Effects of Cognitive Ability on Wages," Wesleyan Economics Working Papers 2006-026, Wesleyan University, Department of Economics.
    5. Gould, Eric D., 2005. "Inequality and ability," Labour Economics, Elsevier, vol. 12(2), pages 169-189, April.
    6. Galindo-Rueda, Fernando & Vignoles, Anna, 2002. "Class Ridden or Meritocratic? An Economic Analysis of Recent Changes in Britain," IZA Discussion Papers 677, Institute of Labor Economics (IZA).
    7. Fan, C. Simon & Wei, Xiangdong & Zhang, Junsen, 2005. ""Soft" Skills, "Hard" Skills, and the Black/White Earnings Gap," IZA Discussion Papers 1804, Institute of Labor Economics (IZA).
    8. Cawley, John & Heckman, James & Vytlacil, Edward, 2001. "Three observations on wages and measured cognitive ability," Labour Economics, Elsevier, vol. 8(4), pages 419-442, September.

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