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  3. American Economic Review
  4. June 2011
  5. Education and Labor Market Discrimination

Education and Labor Market Discrimination

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Abstract

Using a model of statistical discrimination and educational sorting, we explain why blacks get more education than whites of similar cognitive ability, and we explore how the Armed Forces Qualification Test (AFQT), wages, and education are related. The model suggests that one should control for both AFQT and education when comparing the earnings of blacks and whites, in which case a substantial black-white wage differential emerges. We reject the hypothesis that differences in school quality between blacks and whites explain the wage and education differentials. Our findings support the view that some of the black-white wage differential reflects the operation of the labor market. (JEL I21, J15, J24, J31, J71)

Citation

Lang, Kevin, and Michael Manove. 2011. "Education and Labor Market Discrimination." American Economic Review, 101 (4): 1467-96. DOI: 10.1257/aer.101.4.1467

Additional Materials

JEL Classification

  • I21 Analysis of Education
  • J15 Economics of Minorities and Races; Non-labor Discrimination
  • J24 Human Capital; Skills; Occupational Choice; Labor Productivity
  • J31 Wage Level and Structure; Wage Differentials
  • J71 Labor Discrimination