NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Cycles of Wage Discrimination

Jeff Biddle, Daniel S. Hamermesh

NBER Working Paper No. 17326
Issued in August 2011
NBER Program(s):   LS

Using CPS data from 1979-2009 we examine how cyclical downturns and industry-specific demand shocks affect wage differentials between white non-Hispanic males and women, Hispanics and African-Americans. Women's and Hispanics' relative earnings are harmed by negative shocks, while the earnings disadvantage of African-Americans may drop with negative shocks. Negative shocks also appear to increase the earnings disadvantage of bad-looking workers. A theory of job search suggests two opposite-signed mechanisms that affect these wage differentials. It suggests greater absolute effects among job-movers, which is verified using the longitudinal component of the CPS.

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Document Object Identifier (DOI): 10.3386/w17326

Published: "Wage discrimination over the business cycle." Jeff E Biddle and Daniel S Hamermesh. Journal of Labor Policy, 2013 2:7

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