Inequality
The Persisting American Dilemma
Placing Inequality in the
Context of the Course
• Reparations: One Possible Solution to
Inequality
– Atone for slavery and its lingering effects
– A national issue as opposed to personal guilt
• Affirmative Action
– Taking race into account to deal with
discrimination of the past
– Taking race into account to prevent current
discrimination
• The Market
– Discrimination is inefficient
The Dimensions of Inequality
• Tons of evidence showing that Blacks,
Latinos, and American Indians are less
well off than Whites and Asians, and
that women earn less than men
• Why these simple comparisons may be
misleading
– Educational differences
– Experience and continuity
Dimensions, continued
• Test score gap
– Test scores are related to many outcomes
– Test scores are affected by environment during
childhood (parental education, parental income,
parenting practices, schools)
– The test score gap appears to be narrowing over
time
– Test scores are related to schooling and labor
market outcomes
Educational Attainment
• Long-term increase in educational
attainment
• Narrowing of racial and ethnic
differences over time
• Factors associated with racial and
ethnic differences
– Education of parents, family income, family
size, family structure
Labor Market Outcomes
• Employment, Jobs and Unemployment
– Schooling and test scores
– Location
– Competition (split labor market theory,
Bonacich)
– Discrimination: why employers are
reluctant to hire African Americans and
Latinos from the inner city (Neckerman and
Kirschenman)
Economic Well-Being
• 1999: average after-tax income of the
lowest 1/5 was $8,880 compared to the
average after-tax income of the highest
1/5: $102,300
– African Americans, American Indians, and
Latinos are more likely to be in the bottom
1/5 than are whites and most Asian groups
– Is there anything wrong with this?
Economic Well-being,
continued
• Oliver and Shapiro: $43,143 difference in
home equity and financial assets between
blacks and whites, after controlling for other
characteristics
• Home Ownership, 1990: 69% for Whites,
Blacks: 44%, American Indians: 54%, Asians:
52%, Hispanics: 42%
• Home value: Asians: $178,000; Whites:
$80,000; Blacks: 51,000
Asians: A Model Minority?
• Definition: a group successful despite
discrimination and prejudice and without
resorting to political or violent
confrontations
• Common Examples:
1. Japanese Americans
2. Vietnamese students in
American High Schools
Japanese Americans
• Hostility and anti-Japanese legislation in
California (Alien Land Act, 1913;
exclusion from unions; whites only
naturalization)
• Niche became small service
businesses: middleman minorities
• Executive Order 9066 (1942): 1/8
Japanese or more; 2/3 were citizens
Japanese Americans,
continued
• Current situation:
• Educational attainment higher than
white Americans
• Family earnings higher than white
Americans
• “Japan Bashing”
Vietnamese Students
• Hostility and Disadvantage
– “Gook” syndrome
– American opposition to sanctuary after war
in Southeast Asia
– downward occupational mobility upon
arrival for parents
– stereotypical thinking
Vietnamese Students,
continued
• Successes
– overall high level of achievement in
American schools
– parents place emphasis on education, but
this is true of many groups
– education is seen as a family activity
Supporting Evidence
• Prejudice, Discrimination, and Disadvantage
– Chinese, Filipinos, Koreans as well
• Education
– 41% of Asians 25+ have bachelors degrees
compared to 22% of all
• Economic Situation
– high proportions in managerial and professional
occupations
Evidence Against
• Diversity within the Asian population
– bipolar occupational structure
– high poverty rates among some Asian
groups
– Inappropriate comparisons: Immigrant
groups and Internal Colonies
Possible Explanations
• Genetic
– Herrnstein and Murray
– higher performance on tests
• Cultural Explanations
– Confucian values
– Family values and behavior
• Structural Explanations
– Selective Immigration
– Modes of Incorporation
Policy Solutions: William
Julius Wilson
• Create national performance standards for
schools and provide support to inner city
schools to help them meet these standards
• Improve family support programs
– France: family leave, medical care, child care
• Move toward economic integration of cities
and suburbs
Wilson: Solving the Jobs
Problem
• Expand the Earned Income Tax Credit
• Improve Accessibility to Suburban Jobs
• Increase Public Sector Employment
Conclusions
1. Clear evidence of continuing racial
and ethnic disparities in education and
economic well-being.
2. These disparities are cumulative in
both a historical sense and over the
lifetimes of individuals.
3. Academic preparation, reflected in test
scores, and education are keys.
Conclusions, cont.
4. Evidence suggests that discrimination
continues in the labor market.
5. Evidence suggests that country has tired of
solutions based on taking race into account.
6. Question: Will the market eventually solve
these problems, or do we need more
targeting of programs at racial and ethnic
minorities, or do we need policies similar to
those suggested by Wilson?