Other Business Commons^™

Market Structure And Racial Earnings: Evidence From Job Changers, Richard U. Agesa, Jacqueline Agesa, Gary A. Hoover

Economics Faculty Research

In his seminal contribution, Gary Becker (1957) suggests that rents in noncompetitive industries provide employers with the latitude to engage in earnings discrimination. Implicit in this theory, is that white workers in noncompet­itive industries would capture a disproportion­ ate share of monopoly rents (excessive wages) relative to their minority counterparts. We utilize wage-change equations to exam­ine earnings shifts for whites and minorities stemming from a job switch to a different mar­ket structure. Additionally for each racial group, wage equations of workers before and after the job change are used to calculate difference­ in-differences estimates of wage change as a result …