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Research ArticleArticles

Wage Discrimination When Identity Is Subjective

Evidence from Changes in Employer-Reported Race

Christopher Cornwell, Jason Rivera and Ian M. Schmutte
Journal of Human Resources, July 2017, 52 (3) 719-755; DOI: https://doi.org/10.3368/jhr.52.3.0815-7340R1
Christopher Cornwell
Christopher Cornwell is a professor of economics at the University of Georgia. Jason Rivera is Senior Manager and Econometrician at Inductis/EXL Service. Ian M. Schmutte is an assistant professor of economics at the University of Georgia
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Jason Rivera
Christopher Cornwell is a professor of economics at the University of Georgia. Jason Rivera is Senior Manager and Econometrician at Inductis/EXL Service. Ian M. Schmutte is an assistant professor of economics at the University of Georgia
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Ian M. Schmutte
Christopher Cornwell is a professor of economics at the University of Georgia. Jason Rivera is Senior Manager and Econometrician at Inductis/EXL Service. Ian M. Schmutte is an assistant professor of economics at the University of Georgia
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Abstract

In Brazil, different employers report different racial classifications for the same worker. We use the variation in race across employers to estimate the relationship between race and wages. Workers whose reported race changes from nonwhite to white receive a wage increase; those who change from white to nonwhite realize a symmetric wage decrease. As much as 40 percent of the racial wage gap remains after controlling for all individual characteristics that do not change across jobs. We formally test, and reject, the hypothesis that our results are driven by misclassification. We also evaluate several mechanisms that could explain our findings.

  • Received August 2015.
  • Accepted February 2016.
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Journal of Human Resources: 52 (3)
Journal of Human Resources
Vol. 52, Issue 3
1 Jul 2017
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Wage Discrimination When Identity Is Subjective
Christopher Cornwell, Jason Rivera, Ian M. Schmutte
Journal of Human Resources Jul 2017, 52 (3) 719-755; DOI: 10.3368/jhr.52.3.0815-7340R1

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Wage Discrimination When Identity Is Subjective
Christopher Cornwell, Jason Rivera, Ian M. Schmutte
Journal of Human Resources Jul 2017, 52 (3) 719-755; DOI: 10.3368/jhr.52.3.0815-7340R1
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  • Article
    • Abstract
    • I. Introduction
    • II. Race in Brazil
    • III. Data on Race and Job Mobility
    • IV. Modeling Racial Classification and Wages
    • V. Results
    • VI. Possible Mechanisms and Alternative Specifications
    • VII. Conclusions
    • Appendix 1
    • Footnotes
    • References
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