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 Americans2. 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?