The invisible color line and the forgotten gender : gender-race earnings inequality between European-American women and Chicanas/Latinas, 1980 and 1990

After decades of industrial restructuring and structural economic changes, most scholarly research on income inequality have found that overall inequality is rising, but among women, inequality has been and still is declining. Mostly, diverging economic differentials between European-American women and women of color, particularly Chicanas and Latinas, have been overlooked. Women's earnings, if mentioned at all, are said to be converging. In fact, between 1980 and 1990, the weekly earnings gap between European-American women and Chicanas/Latinas widened by nearly 140 percent, according to an annual national demographic and economic survey conducted by the U.S. Bureau of the Census, the Current Population Survey (CPS). This thesis develops a way of thinking on "gender-race earnings gap" and assesses the relative importance of discrimination in explaining women's labor-market outcomes. First, I construct a comprehensive theoretical framework to explain gender-race earnings gap, and then I use quantitative analysis (OLS multiple regression models) to measure the relevant determinants of earnings. Then I break down the income gap using three known decomposition techniques a simple difference in means, subsituting minority means and using majority returns in majority's wage equation, and shift-share analysis to quantify the relative weight of women's attainment of labormarket characteristics versus their returns (wage rewards and penalties) to these characteristics. It is critical to break down the earnings gap to pinpoint specific areas in which public policies could target and be effective. The findings show: First, there is a gender-race earnings gap, which is growing rapidly. Second, discrimination is, perhaps, the most important determinant to explain the gender-race earnings gap. In particular, discrimination appears to play the most important role for the youngest women workers of color (25-34 years old) between 1980 and 1990, indicating growing gender-race inequality and earnings polarization among the new female labor-market entrants of different race and ethnicity. Third, although the racial differences in educational attainment is important in explaining racial wage differentials between Latinas and European Americans, they are not by far the most important. Fourth, within-industry pay disparity accounted for a higher proportion of the wage gap than the distributional pattern of workers in the industries of employment. A rising gender-race earnings gap has serious public policy implications, such as the need to strengthen affirmative action policies and enforce non-discriminatory hiring practices, as there is a lack of appropriate policies to combat discrimination against women of color in the labor markets. Rising gender-race earnings differential has been overlooked during recent scholarly emphasis over skills and spatial mismatches, polarization, and information-technology determinism hypotheses. Research that misses the issue of growing discrimination leads to misguided and ineffectual public policy efforts. Thesis Supervisor: Dr. Leticia Rivera-Torres. Title: Visiting Lecturer.