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Stereotypes, segregation, and ethnic inequality

  • Yuki, Kazuhiro

Disparities in economic outcomes among different ethnic, racial, or religious groups continue to be serious concerns in most economies. Relative economic standings of different groups are rather persistent, although some groups initially in disadvantaged positions successfully caught up with then-advantaged groups. Two obstacles, costly skill investment and negative stereotypes or discriminations in the labor market, seem to distort investment and sectoral decisions and slow down the economic progress of the disadvantaged. How do these obstacles affect skill investment and sectoral choices of individuals of different groups and the dynamics of their economic outcomes and inter-group inequality? Is affirmative action necessary to significantly improve conditions of the disadvantaged, or redistributive policies sufficient? In order to tackle these questions, this paper develops a dynamic model of statistical discrimination and examines how initial economic standings of groups and initial institutionalized discrimination affect subsequent dynamics.

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Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 39704.

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Date of creation: 28 Jun 2012
Date of revision:
Handle: RePEc:pra:mprapa:39704
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  1. Yuki, Kazuhiro, 2008. "Sectoral Shift, Wealth Distribution, And Development," Macroeconomic Dynamics, Cambridge University Press, vol. 12(04), pages 527-559, September.
  2. Hanming Fang & Andrea Moro, 2010. "Theories of Statistical Discrimination and Affirmative Action: A Survey," NBER Working Papers 15860, National Bureau of Economic Research, Inc.
  3. Laura Giuliano & David I. Levine & Jonathan Leonard, 2011. "Racial Bias in the Manager-Employee Relationship: An Analysis of Quits, Dismissals, and Promotions at a Large Retail Firm," Journal of Human Resources, University of Wisconsin Press, vol. 46(1), pages 26-52.
  4. Galor, Oded & Zeira, Joseph, 1988. "Income Distribution and Macroeconomics," MPRA Paper 51644, University Library of Munich, Germany, revised 01 Sep 1989.
  5. Moro, Andrea & Norman, Peter, 2004. "A general equilibrium model of statistical discrimination," Journal of Economic Theory, Elsevier, vol. 114(1), pages 1-30, January.
  6. van de Walle, Dominique & Gunewardena, Dileni, 2001. "Sources of ethnic inequality in Viet Nam," Journal of Development Economics, Elsevier, vol. 65(1), pages 177-207, June.
  7. Yuki, Kazuhiro, 2009. "Education, Signaling, and Wage Inequality in a Dynamic Economy," MPRA Paper 16982, University Library of Munich, Germany.
  8. Becker, Gary S., 1971. "The Economics of Discrimination," University of Chicago Press Economics Books, University of Chicago Press, edition 2, number 9780226041162, June.
  9. Telles, Edward E, 1993. "Urban Labor Market Segmentation and Income in Brazil," Economic Development and Cultural Change, University of Chicago Press, vol. 41(2), pages 231-49, January.
  10. Kerwin Kofi Charles & Jonathan Guryan, 2008. "Prejudice and Wages: An Empirical Assessment of Becker's The Economics of Discrimination," Journal of Political Economy, University of Chicago Press, vol. 116(5), pages 773-809, October.
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