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Doubts Regarding the Human Capital Theory of Racial Inequality
Author(s) -
Kiefer David,
Philips Peter
Publication year - 1988
Publication title -
industrial relations: a journal of economy and society
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.61
H-Index - 57
eISSN - 1468-232X
pISSN - 0019-8676
DOI - 10.1111/j.1468-232x.1988.tb01005.x
Subject(s) - human capital , economics , unemployment , promotion (chess) , wage , labour economics , inequality , government (linguistics) , politics , economic growth , political science , mathematical analysis , linguistics , philosophy , mathematics , law
Using wage data developed by Smith (1984), this paper compares human capital and institutional explanations of trends in the racial wage gap since 1890. While a regression including daily schooling variables is consistent with the human capital theory, so is an institutional model which omits schooling variables but adds the influences of isolation in the rural South, discriminatory hiring and promotion practices, unemployment, and government policy. Including schooling and institutional variables together casts doubt on the relative importance of schooling compared to labor market demands and political variables.