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Abstract
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This paper presents an analysis of income changes based on retrospective life history data collected from white and black men, 30-39 years old in 1968.
Educational level is found to be the most important determinant of initial income for both blacks and whites, but the relationship is weaker for whites than for blacks. Ten years later, education shows a stronger relation to growth in income for whites than for blacks.
The differential impact of levels of education and other background resources of initial income and income 10 years later is examined by partitioning the differences into three components: differences in levels, differences in efficacy, and unexplained differences. For initial income, black resources are more efficacious than those of whites, but the greater average resource levels of whites creates an initial income difference in favor of whites. Ten years later, the efficacy of white background resources for income growth is greater than that for blacks. Intervening events and experiences, whose efficacy favors blacks, keeps the income gap from becoming even wider.
A comparison of this income analysis with a previous analysis of occupational status suggests that whites may be using their resources to obtain jobs with a high status, with the expectation that the job status will in the long run bring high income, while blacks are doing the opposite. Testing of the effectiveness of such a strategy (if it is a conscious strategy) indicates that it is effective for whites, while it would be much less so for blacks. |