Race Composition and Earnings: Effects by Race, Region, and Gender

For more than 40 years, studies have reported that the higher the proportion of blacks in a community, the more white men earn, but the less black men earn. Researchers have speculated that black men earned less because earnings discrimination increases with percent black. Others have suggested that the negative effect of black representation on black men's earnings reflects black men's limited occupational opportunities. This study (1) investigates whether pay discrimination and regional location condition the relationship between black representation and workers' earnings and (2) examines the relationship between black representation and earnings for women. The results, based on 1980 Census data for black and white workers from 267 SMSAs, show that black representation was associated with higher earnings for white men and lower earnings for black men in both the north and south, and that part of the effect for southern black men stemmed from earnings discrimination. Southern black men's earnings gains from black representation offset some of the effects of discrimination, while northern black men encountered costs of black representation even in the absence of earnings discrimination. These findings reflect the disparate economic opportunities of black men in each region as manufacturing jobs have disappeared from the north and relocated to the south. For women, black representation led to higher earnings for blacks and whites. I argue that black representation does not lower black women's earnings because occupational sex segregation prevents black women from threatening white men's economic status.