The Economics of Race, Class and Gender (Econ 250/ES 250)
Phil Martinez - Spring 2008

Exam 2: Race & Gender Discrimination in the Market
(100 points Total)


DUE: 5
5 PM WEDNESDAY, MARCH 18, 2009



Instructions:  This is a take-home exam, therefore, please take your time to provide clear, thoughtful answers.  Remember, the goal of this assignment is for you to illustrate to me that you have covered the required material, that you understand it, and that you have thought about it enough to provide concise, thoughtful answers.

PLAGIARISM: All answers must be your own words reflecting your own understanding and knowledge of the material. All reprinted statements must be fully cited to the original author. Students may NOT copy statements, data, or any other information from ANY source, including internet websites.


Section I: Short Answer Essays
Instructions: Answer all three questions below. A complete, well-presented answer should be around 2 pages for each question. Shorter but no less intelligent nor less complete answers are welcome. This exam may be hand written, but it must be easily legible.

1.    What evidence is there of economic discrimination against African-Americans in the U.S. economy? Be sure to address at least the following issues: differences in unemployment statistics and the wage gap. Cite specific articles from the readings to support your answer. (20 Points)

2. Explain the Labor Segmentation theory of wage differences. (20 Points)

3.    Explain why the following statement is false. Since on average women earn only 76% of men's wages gender discrimination accounts for a full 24% loss in wages to women.
Hint: You need to summarize the non-discriminatory as well as discriminatory factors. (20 Points)


Section II - Multiple Choice: Record your answers on the blue NCS answer sheet provided in class. Use a #2 pencil.


1.    The story of Molly Bannaky, as presented in class, illustrates
    a.    how the slave trade commonly operated in the early colonial period.
    b.    the central role women played in supporting black slavery in the early colonial period.
    c.    the central role women played in resisting black slavery in the early colonial period.
    d.    the degree of integration between blacks and whites based upon class (e.g. slave and
           indentured servant) status in the early colonial period.

2.    According to the storybook, Molly Bannaky, and the article, The Burden of Rice�, African slaves
    a.    had lower skill levels than the white American population in the U.S.
    b.    often had higher skill levels than the white population in the U.S.
    c.    faced a life no worse than they experienced in Africa.
    d.    a and c only.

3.    According to Episode 1, Gumbo, of the documentary Jazz,
    a.    during the period of slavery New Orleans had a higher degree of integration than it did
           after 1877.
    b.    legalized segregation was first introduced after the Civil War.
    c.    the African American population experienced more political and economic freedoms from
           1865 to 1877 than it did from 1877 to 1965.
    d.    all of the above.
    e.    only a and b are correct.

4.    The Jim Crow era
    a.    refers to the period of legalized segregation in the US.
    b.    began in 1877, after Reconstruction.
    c.    began when US troops stopped enforcing equal rights and pulled out of the South.
    d.    ended with the passage of the Civil Rights Act (1964) and the Voting Rights Act (1965).
    e.    all of the above.

5.     According to material presented in lecture (Molly Bannaky, Jazz, etc.) African-American social, political, and economic status has
    a.    consistently improved over the history of the U.S.
    b.    consistently improved since the end of slavery.
    c.    consistently improved since the end of WWII.
    d.    experienced inconsistent periods of improvement, as well as, periods of suppression over the
           history of the U.S.

6.    In general, Americans of African descent receive inferior public education compared to the white majority. This is an example of
    a.    employment discrimination.
    b.    wage discrimination.
    c.    occupational discrimination.
    d.    post-market discrimination.
    e.    pre-market discrimination.

7.    A hiring process that arbitrarily hires African Americans last and fires them first is an example of
    a.    employment discrimination.
    b.    wage discrimination.
    c.    occupational discrimination.
    d.    post-market discrimination.
    e.    pre-market discrimination.

8.    A hiring process which arbitrarily restricts women from particular positions and keeps them in positions in which they are overqualified is an example of
    a.    employment discrimination.
    b.    wage discrimination.
    c.    occupational discrimination.
    d.    post-market discrimination.
    e.    pre-market discrimination.

9.    The unemployment rate for Americans of African descent is
    a.    roughly half that of Americans of European descent.
    b.    consistently twice as high as that of European-descent Americans, regardless of all other factors.
    c.    consistently falling and will be roughly equal to the European American rate by 2010.
    d.    consistently rising compared to the rate suffered by European-descent Americans.

10.    The particular pattern of the Black unemployment rate compared to the White unemployment rate is important because
    a.    it is proof that market competition erodes discrimination.
    b.    it shows that Black employment rate has improved from about 79% of the White unemployment rate to approximately 88% of the White rate.
    c.    it is evidence that the Civil Rights movement has been successful in improving the employment status of African-Americans.
    d.    it is evidence that employment discrimination against Blacks is systemic and has not improved in any sector of the economy.

11.    Gary Becker argued that discrimination could be explained
    a.    by the natural result of market competition.
    b.    by the profit incentive generated by markets.
    c.    as  a preference for a normal good for which discriminators would be willing to pay.
    d.    all of the above.

12.    Which model concludes that a competitive market will eliminate discrimination by forcing the discriminating firm out of business, or forcing it to stop discriminating in order to effectively compete?
    a.    The Political Economy Model.
    b.    The Neoclassical Model of Market Competition
    c.    Statistical Discrimination Model
    d.    All of the above

13.    According to the Neo-classical view, discrimination can persist in the market only if
    a.    the discriminators are a large enough segment of the market to enforce their will via
           substantial purchasing power or market power.
    b.    the discriminators can identify the transaction or market activity with the targeted group.
    c.    discrimination is efficient.
    d.    all of the above.
    e.    a and b only.

14.     In a Neoclassical model which of the following might be considered a discriminatory factor?
    a.    race
    b.    gender
    c.    age
    d.    all of the above.
    e.    none of the above.

15.   
In a Neoclassical model which of the following might be considered a non-discriminatory factor?
    a.    biological differences
    b.    gender
    c.    age
    d.    all of the above.
    e.    none of the above.


16.    Pre-market discrimination refers to
    a.    discrimination by consumers, rather than by businesses.
    b.    placing signs or symbols in front of a market or business to discourage the targeted group
           from entering, for example placing a Confederate battle flag outside a store.
    c.    unequal treatment in non-market settings that result in unequal economic results, for example
           providing lower quality education in poor communities thereby lowering the community’s
           average wages.
    d.    a form of economic discrimination in which a filtering process, such as an in person interview,
           is used to remove members of the targeted group from the formal economic transaction occurs.

17.     Supply-side differences or supply-side discrimination refer to disparities
    a.    between producers.
    b.    that are being caused by the employer or business.
    c.    that are characteristics of the workers and external to the employment process, such as pre-
           market discrimination.
    d.   that improve production and increase supply.

18.    Demand-side differences or demand-side discrimination refer to disparities
    a.    between producers.
    b.    that are being caused by the employer or business.
    c.    that are characteristics of the workers and external to the employment process, such as pre-
           market discrimination.
    d.    that improve production and increase supply.

19.    The model of discrimination which argues that the labor market is segregated into two separate labor markets, one with high compensation, training, promotions, and requires higher education; while the other has low compensation, little training, few promotions, and requires low skill levels is
    a.    the Employee Discrimination model.
    b.    the Dual or Segmented Labor Market model.
    c.    the model of Statistical Discrimination.
    d.    the Employer Discrimination model.

20.    Which of the following models is associated with the Political Economy approach to analyzing economic discrimination?
    a.    the Employer-Taste for Discrimination model.
    b.    the Employee Discrimination model.
    c.    the model of Statistical Discrimination.
    d.    the Dual or Segmented Labor Market model.

21.   According to one study reported in the text, in Milwaukie, in 1990
    a.   as a group white men earned $1.15 per hour more than white women and minorities with the same education, experience, and other productive characteristics.
    b.   if white women and minorities were paid at the same rate as white males they would receive an additional $2.99 per hour.
    c.   employers gained $1.5 billion by paying white women and minorities less than the white male wage.
    d.   all of the above are correct.
    e.   only a and c are correct.


22. In the article, Black-White Income Differences�, Michael Reich argues that
    a.    income date since WWII indicate that Black income has been consistently catching up to White income.
    b.    the pattern of Black-to-White income is best explained by decreasing discrimination in the labor market.
    c.    Black income has caught up to White during periods of political and legislative pressure
           for equal treatment.
    d.    Black income has caught up to White income due to the competitive pressures of the market.

23. In the article, Black-White Income Differences�, Michael Reich makes which of the following claims?
    a.    Black incomes improved during WWII because the federal government established non-
           discriminatory hiring policy for the first time in U.S. history, due to political pressure.
    b.    Progress in black incomes has been uneven, often deteriorating during many periods.
    c.    Most of the increase in the black-white income ratio was concentrated in the 1960s and early 1970s.
    d.     All of the above.

24.    Help-wanted ads cited by in class (Darity and Mason) provide evidence that
    a.    the competitive market did not remove employment discrimination independently.
    b.    it took federal legislation to end the most overt forms of employment discrimination.
    c.    the market formally segregated women into lower-paying jobs.
    d.    the market formally incorporated racial preferences as qualifying criteria for jobs.
    e.    all of the above.    

25.    Darity and Mason cite an audit study by the Fair Employment Council of Greater Washington D.C.
According to this study

    a.    half of the white job applicants received job offers compared to only 11% of black applicants even
           though the applicants were matched with similar credentials.

    b.    whites were offered 15 cents more per hour than their black counterpart.
    c.    whites were disproportionately considered for unadvertised, higher level positions.
    d.    rates of discrimination based upon race or Hispanic ethnicity were above 20%.
    e.    all of the above.

26.    Darity and Mason offer which of the following as a non-traditional analysis of the persistence of the wage gap?
    a.    The wage gap persists because blacks on average have lower quality educational opportunities.
    b.    The wage gap persists because as a group is discriminated against it may lose motivation and cease
            to pursue educational and job training opportunities.

    c.    The level of racism has stayed relatively constant generating a persistent wage gap.
    d.    all of the above.
    e.    There is no economic discrimination in the wage gap.

27.    The Darity and Mason article indicates that the percent of the male black-white wage gap due to discrimination is approximately
    a.    5% or less                 c.    15% to 20%             e.    12% to 15%
    b.    5% to 12%                d.    20% to 25%

28.    Since the early 1970's average black wages have
    a.    been slowly falling farther behind average white wages
    b.    continued to catch-up to white wages, but at a slower rate.
    c.    continued to catch-up to white wages at the same rate as 1940 to 1970
    d.    caught-up more rapidly with white wages.

29.    The Female-to-Male Earnings Ratio measures
    a.    the differences in occupations between men and women.
    b.    the percentage of the male pay that a woman earns when the man and woman are
           employed in the same job and have equal qualifications.
    c.    the full degree of gender discrimination in the economy.
    d.    the average dollar difference between male income and female income in the economy.
 
30.   According to the text, which of the following argues that employers may discriminate due to the economic incentives?
    a.    The Neoclassical analysis of discriminiation.
    b.    The Statistical Model of discrimination.
    c.    The Emloyer Model of discrimination.
    d.    The Employee Model of discrimination.
    e.    The Political Economy analysis of discrimination

31.    Which of the following are non-discriminatory factors that may explain some portion of the female-to-male earnings gap?

    a.    Women intentionally choose to stay out of the work force for periods of time to bear and raise children.
    b.    Women struggle to balance their jobs with childcare by choosing jobs that are more easily integrated into  
           home-life, but pay lower wages.

    c.    Since women of equal qualifications are paid less, it is rational for women to choose to invest in less
           education and training since it will not pay off.

    d.    a and b
    e.    b and c

32.    Which of the following are discriminatory factors that may explain some portion of the female-to-male earnings gap?
    a.    Women are socialized to value family responsibility over career achievements.
    b.    Women choose jobs that are close to home and flexible to be more available to children when needed.
    c.    Poor labor market opportunities for women lower their earnings and increase the attractiveness of
           work in the home.

    d.    a and b
    e.    a and c

33.    The Texaco case of racial discrimination is an example of
    a.    the Employer-Taste for Discrimination model.
    b.    the Employee Discrimination model.
    c.    the model of Statistical discrimination.
    d.    the Over-Crowding model.
    e.    the Dual or Segmented Labor Market model.

34.    The case of the northern California district of the National Forest Service, where female workers were denied promotions, higher-paying jobs, and harassed all by male co-workers is an example of
    a.    the Employer-Taste for Discrimination model.
    b.    the Employee Discrimination model.
    c.    the model of Statistical discrimination.
    d.    the Over-Crowding model.
    e.    the Dual or Segmented Labor Market model.

35.    The discrimination model where the employer believes women are less productive on average and therefore treats all female applicants and employees as if they were each less productive is
    a.    the Employer-Taste for Discrimination model.
    b.    the Employee Discrimination model.
    c.    the model of Statistical Discrimination.
    d.    the Dual or Segmented Labor Market model.

36.    The discrimination model which argues that women earn lower wages because they are squeezed into a segregated market where the supply of female labor is greater than the demand for female labor
    a.    the Employer-Taste for Discrimination model.
    b.    the Employee Discrimination model.
    c.    the Statistical Discrimination model.
    d.    the Over-Crowding model.
    e.    the Dual or Segmented Labor Market model.

37. The model that says that differences in male and female wages and occupations is due to women pursuing different incentives such as family friendly jobs or physical security is known as
    a.    a gender choice model.
    b.    occupational segregation.
    c.    a rational choice model.
    d.   an individual wage selection model.

38.    In general, compared to African Americans, women face higher rates of
    a.    occupational segregation.
    b.    employment discrimination.
    c.    human capital discrimination.
    d.    a and b
    e.    b and c

39.    The advancement of white women into the middle levels of business ownership and management, but the continued lack of women at the upper and executive levels of corporate management is referred to as:
    a.   the stuck elevator� phenomenon.
    b.   the glass ceiling�.
    c.    the mommy-manager� syndrome.
    d.    the biological clock�.
    e.    comparable worth.

40.    The 1991 Boston Federal Reserve Study of bank lending practices     
    a.    proved that discrimination in lending practices accounted for a 56% higher denial rate for black
           and Hispanic loan applicants.

    b.    confirmed that discrimination did not occur in bank loan process.
    c.    provided contrary and inconclusive evidence that discrimination in bank loans was responsible
           for the difference in loan approvals between black and white applicants.

    d.    proved that discriminatory lending practices were the result of individual discrimination by
           white loan officers who more readily identified with white applicants.