Black-white wage differentials in a multiple sample selection bias model

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3 Scopus citations

Abstract

This paper simultaneously incorporates two sources of selection bias in the black-white wage equations. It demonstrates that the biases due to an individual's propensity to be in the labor force and the firm's hiring practices are important in determining the black-white wage differential and failure to account for both biases will result in inaccurate estimation of the black-white wage differential. We found that adjusting for double selection bias in the wage equation, the black-white female wage gap is 26% larger than the black-white male wage gap, and 12.1% larger when we adjust for a single selection bias. The results seem to suggest that at the macro level, the enforcement of policies related to racial issues in the labor market will likely lead to a reduction in the black-white wage gap.

Original languageEnglish (US)
Pages (from-to)1-16
Number of pages16
JournalAtlantic Economic Journal
Volume37
Issue number1
DOIs
StatePublished - Jan 1 2009

All Science Journal Classification (ASJC) codes

  • Economics, Econometrics and Finance(all)

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