Kerwin Kofi Charles

Prejudice and Wages: An Empirical Assessment of Becker’s The Economics of Discrimination

We test the predictions from Becker’s (1957) seminal work on employer prejudice and find that relative black wages (a) vary negatively with the prejudice of the “marginal” white in a state, (b) vary negatively with the prejudice in the lower tail of the prejudice distribution but are unaffected by the prejudice of the most prejudiced persons in a state, and (c) vary negatively with the fraction of a state that is black. Our estimates suggest that one‐quarter of the racial wage gap is due to prejudice, with nontrivial consequences for black lifetime earnings.

The Transition to Home Ownership and the Black-White Wealth Gap

This paper analyzes differences in the likelihood that black and white families become homeowners. By following a sample of black and white renters over time, we are able to separately study racial differences in the likelihood of applying for a mortgage and in the likelihood that a mortgage application is accepted. Although its effect on the race gap in housing transitions is small, we find strong evidence that black applicants are almost twice as likely as comparable white households to be rejected, even when credit history proxies and measures of household wealth are accounted for. We show that the housing transition gap exists primarily because blacks are less likely to apply for mortgages in the first place. The analysis suggests that differences in income, family structure, and in the ability and willingness of parents to provide down-payment assistance are the primary reasons for this applications gap. We speculate that the portion of the gap that remains unexplained after controlling for income, demographics, and wealth may be the result of blacks anticipating a greater chance of rejection when they apply for mortgages.

Local labor market fluctuations and health: Is there a connection and for whom?

We examine the relationship between local labor market conditions and several measures of health and health behaviors for a sample of working-aged men living in the 58 largest metropolitan areas in the United States. We find evidence of procyclical relationships for weight-related health and mental health for men with low ex ante employment probabilities. Separate estimates suggest worsening labor market conditions lead to weight gains and reduced mental health among African-American men and lower mental health among less-educated males. Among our findings, those related to mental health are most pronounced.

Male Incarceration, the Marriage Market, and Female Outcomes

This paper studies how rising male incarceration has affected women through its effect on the marriage market. Variation in marriage-market shocks arising from incarceration is isolated using two facts: the tendency of people to marry within marriage markets defined by the interaction of race, location, and age and the fact that increases in incarceration have been very different across these three characteristics. Using a variety of estimation strategies, including difference and fixed effects models and TSLS models in which we use policy parameters to instrument for within-marriage market changes in incarceration, we find evidence that is, on the whole, consistent with the implications of the standard marriage-market model. In particular, higher male imprisonment appears to have lowered the likelihood that women marry, modestly reduced the quality of their spouses when they do marry, and shifted the gains from marriage away from women and toward men. The evidence suggests that women in affected markets have increased their schooling and labor supply in response to these changes.

Gender Differences in Completed Schooling

This paper summarizes the dramatic changes in relative educational attainment by men and women over the past three decades. Stock measures of education among the entire adult population show rising attainment levels for both men and women, with men enjoying an advantage in schooling levels throughout this interval. Cohort-specific analysis reveals that these stock measures mask two interesting patterns: (a) gender difference at the cohort level had vanished by the early 1950 birth cohort and has been reversed in sign ever since; (b) for several cohorts, attainment rates were flat for women and flat and falling for men. This last is puzzling in the face of the large college premia that these cohorts observed when making their schooling choices. We present a simple human capital model showing how the anticipated dispersion of future wages should affect educational investment, and find that a model which includes measures of future earnings dispersion fits the data for relative schooling patterns quite well.

Taste‐based or Statistical Discrimination: The Economics of Discrimination Returns to its Roots

We briefly review the evolution of empirical work on discrimination. We discuss why traditional regression‐based approaches neither convincingly measure market discrimination nor disentangle the relative importance of animus versus statistical discrimination in explaining such discrimination as exists. We describe the development of modern correspondence studies. We argue that these studies have the promise to credibly identify the presence of discrimination if not its magnitude, can inform us about the underlying mechanism generating discrimination and can also point to avenues for new theoretical and empirical work on discrimination. We discuss two articles with exemplary applications of these new methods.

Hours Flexibility and Retirement

Data from the Health and Retirement Study indicate that hours constraints are a common feature of jobs held by workers nearing retirement. We present a simple model that predicts that workers who are not free to lower their usual hours of work should be more likely than their unconstrained counterparts to retire by some future date. Our estimates, which are robust to various specifications, support this prediction. The amount by which being hours constrained is estimated to raise retirement probabilities is nearly as large as the effect of being in relatively poor health, suggesting an economically significant effect. (JEL J26, J22, J14)

The Effects of Sexism on American Women: The Role of Norms vs. Discrimination

We study how reported sexism in the population affects American women. Fixed-effects and TSLS estimates show that higher prevailing sexism where she was born (background sexism) and where she currently lives (residential sexism) both lower a womans wages, labor force participation and ages of marriage and childbearing. We argue that background sexism affects outcomes through the influence of previously-encountered norms, and that estimated associations regarding specific percentiles and male versus female sexism suggest that residential sexism affects labor market outcomes through prejudice-based discrimination by men, and non-labor market outcomes through the influence of current norms of other women. Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at www.nber.org.