From Dark to Light
Skin Color and Wages Among African-Americans
Goldsmith, Arthur H., Darrick Hamilton, and William Darity, Jr., Journal of Human Resources, 42(4), pp. 701-738.
The Preference for WhitenessHypothesis
• Social categorization is a fundamental cognitive process leading to in-groups and out-groups.
• Out-groups are exposed to prejudice and in-group members receive preferential treatment.
• In the U.S., whiteness is a defining attribute of the in-group.
• Possessing characteristics of the white in-group in the form of skin shade may lead to preferential treatment of light-skinned relative to darker-skinned African-Americans.
>>> Earnings will be related to the lightness of skin color, not just race.
Primary Questions
• Do light-skinned African-Americans earn more relative to whites than dark-skinned African-Americans?
• Among African-Americans, are there wage differences by skin shade?
Data
Multi-City Study of Urban Inequality (MCSUI)
• Authors’ sample: 948 Black and White Working Men Aged 19-65, 1992-1994
•Interviewer/individual race match.•Interviewers trained to establish
consistency in identifying skin shade.National Survey of Black Americans (NSBA)• 331 Black Working Men Aged 19-65, 1978-
1979
Mean of the Hourly Wage (MCSU)
• White $15.94• Light Black 14.42• Medium Black 13.23• Dark Black 11.72
Dummy Variable Method
Traditional ModelW = b1 + b2 RACE + …
RACE = 1 if individual is African-American = 0 if white.
b2 < 0 is evidence of discrimination vs. blacks.b2 > 0 is evidence of discrimination vs. whites.b2 = 0 is evidence of no discrimination.
“Rainbow” Model
W = b1 + b2 Light Black + b3 Medium Black + b4 Dark Black + …where skin shade variables are dummy variables.• b2 < 0, b3 < 0, and b4 < 0 is evidence of discrimination vs. light-skinned, medium dark-skinned, or dark-skinned blacks, respectively.
• |b2| < |b3| and |b2| < |b4| is evidence that light-skinned blacks face less discrimination than medium dark and dark skinned blacks.
Control Variables
• Human Capital: education, job tenure, disability• Workplace Characteristics: union status, firm size, supervise others, work part-time• Demographic Characteristics: age, married, number of dependents, foreign resident at 16 years of age• Family Characteristics when Young: raised by both parents, mother high school grad, father high school grad
Results Dummy Variable Method
1Controlling for human capital, workplace, and demographic variables.
Results Oaxaca Wage Decomposition
Technique 1
1Controlling for human capital, workplace, and demographic variables.
Conclusion
• Skin shade matters. Estimates indicate that light-skinned African-Americans earn more relative to whites than dark-skinned African-Americans.
• The black-white dichotomy used in labor economics yields misleading results. • The theory of the preference for whiteness is consistent with the results.