Discrimination, Affirmative Action, and Equal Opportunity

292 Pages·2004·3.67 MB·English

Discrimination,
Affirmative Action,
and Equal
Opportunity
Contributors includ e
Gary Becker, Thomas Sowell,
and Kurt Vonnegut, Jr.
Co-edited by W.E. Block
and M.A. Walker
The Fraser Institute
www.fraserinstitute.org
Discrimination,
Affirmative Action,
and Equal
Opportunity
An Economic and Social Perspective
Contributors includ e
Gary Becker, Thomas Sowell,
and Kurt Vonnegut, Jr.
Co-edited by W.E. Block
and M.A. Walker
THE FRASER INSTITUTE
1982
www.fraserinstitute.org
Canadian Cataloguing in Publication Data
Main entry under title:
Discrimination, affirmative action and equal
opportunity
Bibliography: p.
Includes index.
ISBN 0-88975-039-4
1. Minorities - Employment - Addresses, essays,
lectures. 2. Women - Employment - Addresses,
essays, lectures. 3. Discrimination in employment
- Addresses, essays, lectures. 4. Affirmative
action programs - Addresses, essays, lectures.
I. Becker, Gary S., 1930- II. Sowell, Thomas,
1930- III. Vonnegut, Kurt, 1922- IV.
Block, Walter, 1941- V. Walker, Michael,
1945- VI. Fraser Institute (Vancouver, B.C.)
. HD4903.D58 331.13'3 C81-091321-6
v y
Copyright © 1981, by The Fraser Institute.
All Rights Reserved.
No part of this book may be reproduced in any form or
by any electronic or mechanical means including infor-
mation storage and retrieval systems, apart from short
passages for use in reviews, without permission from
The Fraser Institute. Reproduction of this material
without authorization, by any method of duplication
whatsoever, is a violation of copyright.
www.fraserinstitute.org
Contents
PREFACE xv
INTRODUCTION 5
Walter Block and Michael Walker
Respectively Senior Economist and Director,
The Fraser Institute
THE PLIGHT OF THE MINORITY 5
Evidence on discrimination 5
WHAT'S WRONG WITH DISCRIMINATION? 6
What is discrimination? 6
Discrimination defines individuality 6
Majorities vs. minorities 6
Discriminatory enactments 7
Majority discrimination 7
Minorities doomed? 8
THE ECONOMIC PERSPECTIVE 9
Discrimination—a form of choice 9
In the market, discrimination costs money 9
The ceaseless quest for profits 10
Prejudice not profitable 11
The dollar vote or the political vote? 11
The back of the bus 11
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vi Contents
COMPETITION-THE GREAT EQUALIZER 12
Discrimination in employment 12
Anti-Jewish discrimination 12
A two-edged sword 13
HOW MUCH DISCRIMINATION? 14
The standard approach 14
THE WEBER ANDBAKKE CASES IN PERSPECTIVE 15
Equality of opportunity vs. equality of results 15
Inequality and discrimination 16
The effects of affirmative action 17
Judicial misunderstandings 18
UNECONOMIC DISCRIMINATION 18
Prejudice and differentials 18
Fooling the employer 19
Sports 20
Barriers to entry 20
Blacks and education 21
Applying pressure 21
Vouchers 22
House building 22
ECONOMIC INTERVENTION, DISCRIMINATION, AND
UNFORESEEN CONSEQUENCES 22
Equal pay? 23
Arbitrariness 23
PAYING FOR DISCRIMINATION 24
Two countries 24
Discrimination typology 25
AFFIRMATIVE ACTION REVISITED 25
Subjective identification 26
Punishing the innocent 26
Ruining the talented 27
Pushing down the downtrodden 27
Redefining merit 27
Attrition 28
THE XYZ CORPORATION: A CASE STUDY 28
Evidence of discrimination? 28
Why such differences? 29
Some interesting sociological variables 30
A GRISLY TALE 30
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Contents vii
PART 1: EQUALITY AND THE LAW
CHAPTER 1: WEBER ANDBAKKE, AND THE
PRESUPPOSITIONS OF
"AFFIRMATIVE ACTION" 37
Thomas Sowell
Senior Fellow
Hoover Institute
EVOLUTION 38
Distinction between information networks and decision
points 39
Retrospective results 39
Societal patterns 40
Distinction between prospective opportunity and
retrospective results 41
PRESUPPOSITIONS 42
Importance of age differences 43
Geographical distribution 43
Cultural differences 44
Blacks and Jews 45
The Ethnic Vision and the "National Average" 45
Anglo-Saxon dominance? 47
The special case of blacks 48
Same color, different culture 48
Second generation West Indians 49
The special case of women 50
Single women earn more than single men 51
Institutional Responsibility 51
Imposed costs 52
"Results" of "affirmative action" 53
Equal opportunity, not "affirmative action" 53
The academic world 54
Perverse results 55
THE BAKKE CASE 56
Complexity, difficulty, arbitrariness 57
Technical grounds 57
Creative history 58
Burden of proof 58
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viii Contents
THE WEBER CASE 60
Voluntary quotas? 60
SUMMARY AND IMPLICATIONS 61
Blacks are not unique 62
Ideological designations 63
PART 2: THE ECONOMICS OF EQUALITY
CHAPTER 2: ON DISCRIMINATION, PREJUDICE,
RACIAL INCOME DIFFERENTIALS,
AND AFFIRMATIVE ACTION 69
Walter Williams
Economics Department
George Mason University
RACIAL DISCRIMINATION AS AN EXPLANATION OF
WAGE DIFFERENTIALS 69
The effect of education 69
Statistically elusive factors 70
Paradoxical female income ratios 70
The flaw in the "taste for discrimination" hypothesis 72
Professional occupational distribution is crucial 73
Statistical test 73
Women: a special case 74
Investment in human capital 75
RACIAL DISCRIMINATION IN THE LABOR MARKET 76
Prejudice and discrimination 76
Operational definitions of discrimination and prejudice 78
Statistical discrimination 79
Search vs. experience 80
Employee contributions to total output 81
Short term work contracts 83
Pure search: sports and academia 83
MARKET ENTRY BARRIERS AND INCOME
DIFFERENTIALS 85
The law and minority group welfare 85
The Davis-Bacon Act 86
National Labor Relations Act 87
Minimum wage laws 88
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Contents ix
Licensing 89
AFFIRMATIVE ACTION AND EQUALITY OF
EDUCATIONAL OPPORTUNITY 91
Higher education and minority opportunity 91
Quality of black education 91
Affirmative action admissions policy 92
Educational vouchers 94
University employment 95
Employment in construction 96
Appendix A 98
Appendix B 99
CHAPTER 3: ECONOMIC INTERVENTION,
DISCRIMINATION AND
UNFORESEEN CONSEQUENCES 103
Walter Block
Senior Economist
The Fraser Institute
MINIMUM WAGE LAWS 104
Compensating differentials 104
EQUAL PAY FOR EQUAL WORK 105
Arbitrariness 106
The earnings gap 107
Corrections in the estimates 108
Wages and salaries only 111
Market impediments 113
AFFIRMATIVE ACTION IN THE PUBLIC SECTOR 113
Public sector quotas? 114
A modest proposal 114
INSURANCE 115
A difficulty 115
Pension plans and snooping 116
Customer discounts 117
Consumer tips 117
Why the questionnaires ? 118
AGEISM 119
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Contents
SIZE DISCRIMINATION 120
How tall is tall? 120
Short police 121
RENT CONTROL LEADS TO DISCRIMINATION 122
USURY 122
No loans 123
ZONING 124
Exclusions 124
CHAPTER 4: AN ECONOMIC THEORY OF
DISCRIMINATION 129
Gary S. Becker
Economics Department
University of Chicago
INTRODUCTION 129
FORCES DETERMINING DISCRIMINATION IN THE
MARKETPLACE 130
The analytical framework 130
Tastes for discrimination 132
Market discrimination 133
EFFECTIVE DISCRIMINATION 134
The model 135
Discrimination and capitalists 136
DISCRIMINATION IN THE ECONOMY 136
Employer discrimination 136
Trade union discrimination 137
Consumer discrimination 138
GOVERNMENT DISCRIMINATION 139
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