Here’s What Economists Don’t Understand About Race

Darity wondered, then, why disparities persist, even when markets are competitive. Black Americans, for example, are paid less than their white counterparts at every level of education. ...Motivated by what he describes as youthful hubris, Darity got a Ph.D. in economics and set out to change the way economists deal with these issues...With a group of colleagues that include Darrick Hamilton and James Stewart, he has developed a framework for understanding the inequality problem, which he calls “stratification economics.” The new approach —interdisciplinary and integrating economics with psychology and sociology — expands the boundaries of how economists analyze intergroup differences.

“The traditional approach says that educational attainment is a consequence of parental investment,” says Darity, “but it doesn’t explain how parents can feasibly make those investments.”

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