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Changes in the earnings of Arab men in the US between 2000 and 2002

Abstract

Using public-use microdata samples from the American Community Survey, we find that Middle Eastern Arab men and Afghan, Iranian, and Pakistani men experienced a significant earnings decline relative to non-Hispanic whites between 2000 and 2002. Further analyses based on the Juhn–Murphy–Pierce wage decomposition technique as well as quantile regression indicate that this earnings decline is not explained by changes in the structure of wages or in observable characteristics beyond ethnicity. Our interpretation is that the unanticipated events of September 11th, 2001 negatively affected the labor-market income of the groups most closely associated with the ethnicity of the terrorists.

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Notes

  1. For an overview of the rising discrimination against individuals of Arab and Middle Eastern descent following September 11th, see the American–Arab Antidiscrimination Committee Research Institute (2003) and Human Rights Watch (2002).

  2. An important example of a natural experiment to study labor markets is Card’s (1990) analysis of the impact of the sudden increase in the supply of labor on a region’s native wages resulting from the Marielito migration to Miami in 1980. This paper takes a similar approach in that it explores the labor-market impact of a sudden shock on the earnings of workers most likely identified as having ethnic ties to suspected 9-11 terrorists.

  3. Whether or not discrimination-driven wage gaps persist into the long-run is a subject of much debate; for a review, see Stiglitz (1973) and Marshall (1973). Given the unexpected shock of the 9-11 events, our approach to this study only involves a short-run time frame.

  4. We construct a continuous education measure by taking the midpoint of the education categories in the ACS, or where possible, the average number of years related to certain schooling levels (e.g., 16 years for a college degree).

  5. A closer perusal of the PUMS ACS data indicates that the share of Arab men between the ages of 25 and 40 who were not working increased during this same time period relative to non-Hispanic whites: 8.8% of Middle Eastern Arab men and 4.0% of non-Hispanic white men did not work in 2000, increasing to 11.6% (Middle Eastern Arab men) and 4.6% (non-Hispanic whites) in 2002. Similarly, the share of Middle Eastern Arab male workers employed for less than 20 h per week increased from 11.2 to 16.1% between 2000 and 2002, compared to an increase from 7.5 to 9.1% for non-Hispanic white employees. While non-wage issues related to changes in the employability of Arab vis-à-vis non-Hispanic white men following 9-11 go beyond the scope of this study, they serve as interesting fodder for future research.

  6. Due to the semilogarithmic construction of Eq. 1 and the binary nature of the ethnic group variables, a more precise earnings penalty than β i can be obtained using the method discussed by Kennedy (1981). In this paper, for simplicity, we discuss the β i ’s as estimates of earnings penalties.

  7. Recall that the focus of this study is on younger men. When expanding the samples to include workers between the ages of 25 and 64, the estimation of Eq. 1 indicates that Middle Eastern Arab men continued to experience a significant (at the 5% level) average earnings decline relative to non-Hispanic white men; the coefficients (standard errors) on Middle Eastern Arab were −0.198 (0.056) for 2000 earnings and −0.454 (0.118) for 2002 earnings. The average earnings decline among Afghan, Iranian, and Pakistani men, however, is no longer statistically significant at conventional levels in the broader sample [coefficient (standard error)=−0.351 (0.072) for 2000 and −0.392 (0.066) for 2002].

  8. For example, Human Rights Watch (2002) notes that working relationships and networks between local law enforcement agencies and the community enable the law enforcement to gain intelligence and quickly deploy forces into “sensitive” areas following a terrorist event, thus mitigating the potential backlash against a particular ethnic group. Moreover, individuals in communities with such relationships with local officials might feel more comfortable in reporting discriminatory acts.

References

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Correspondence to Alberto Dávila.

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Responsible editor: Klaus F. Zimmermann

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Dávila, A., Mora, M.T. Changes in the earnings of Arab men in the US between 2000 and 2002. J Popul Econ 18, 587–601 (2005). https://doi.org/10.1007/s00148-005-0050-y

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Keywords

  • Arab Americans
  • September 11th
  • discrimination

JEL Classification

  • J71
  • J31
  • J23