Journal of Family and Economic Issues

, Volume 15, Issue 3, pp 279–294 | Cite as

Racial wage differentials among young adults: Evidence from the 1990s

  • Mohamed Abdel-Ghany
  • Deanna L. Sharpe


This study seeks to decompose wage differentials between black and white male young adults into those related to labor market discrimination and those resulting from human capital endowments. The importance of testing for significant differences in wage equations before conducting decomposition analysis is emphasized. Study results demonstrate that ignoring correction for the sample selection bias resulting from black-white differences in the probability of being employed would lead to an underestimation of the size of wage differentials. The study also shows that the results of models based on different assumptions regarding the nondiscriminatory wage structure might lead to different conclusions pertinent to the extent of labor market discrimination. Implications for public policy development are discussed.

Key Words

black-white wage differentials labor market discrimination sampleselection bias wage structure 


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Copyright information

© Human Sciences Press, Inc. 1994

Authors and Affiliations

  • Mohamed Abdel-Ghany
    • 1
  • Deanna L. Sharpe
    • 1
  1. 1.Department of Consumer Sciences and Director of International Affairs, College of Human Environmental SciencesThe University of AlabamaTuscaloosa

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