CREAT: Census Research Exploration and Analysis Tool

Interfirm Segregation and the Black/White Wage Gap

August 1996

Working Paper Number:

CES-96-06

Abstract

This paper studies interfirm racial segregation in two newly developed firm-level databases. Within the representative MSA, we find that the interfirm distribution of black and white workers is close to what would be implied by the random assignment of workers to firms. However, we also find that black workers are systematically clustered in "black" employers where managers, owners, and customers are also black. These facts may be reconciled by the facts that a) there are not enough black employers to generate much segregation and that b) perhaps other difficult-to-identify forces serve to systematically integrate black and white workers. Finally, we find that the black/white wage gap is entirely a within-firm phenomenon, as blacks do not work in firms that pay low wages on average.

Document Tags and Keywords

Keywords Keywords are automatically generated using KeyBERT, a powerful and innovative keyword extraction tool that utilizes BERT embeddings to ensure high-quality and contextually relevant keywords.

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:
economist, black, minority, labor, ethnic, hispanic, establishment, white, hiring, segregated, discrimination, discriminatory, workforce, segregation, disadvantaged, racial, interracial, race

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:
Metropolitan Statistical Area, Characteristics of Business Owners, Internal Revenue Service, Center for Economic Studies, Harvard University, University of Maryland, American Economic Review, University of Chicago, Current Population Survey, WECD, Decennial Census, Journal of Human Resources

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