The Causes of Wealth Inequality (10): Racism

In the U.S., the median annual income for black families is 38 percent lower than for their white counterparts. So, income inequality in the U.S. has a racial component, and some of the explanations or causes of income inequality may have something to do with racism. I say “may” because if income inequality were essentially or mainly a consequence of racism, then there wouldn’t be any white poverty. Moreover, given the growth of total income inequality in the U.S. during the last decades, the income gap between whites and blacks should have grown in the same proportion if racism is the sole cause. And that didn’t happen:

the black/white gap in median family income has stagnated; it’s a mere three percentage points smaller today than it was in 1979. … [D]uring the current economic downturn, the black/white income gap widened somewhat. … [T[he black/white income gap can’t be a contributing factor to the [increase in inequality] if it hasn’t grown over the past three decades. And even if it had grown, there would be a limit to how much impact it could have on the national income-inequality trend, because African-Americans constitute only 13 percent of the U.S. population. (source)

The growth of income inequality in the U.S over the last decades can’t be blamed on racism, since inequality has risen across social groups, but perhaps part of the level of income inequality can be blamed on it. I don’t know how large a part, but probably not a very large part, given all the other likely causes of income inequality.

Still, I focus on the U.S. here, and that isn’t by far the only country plagued by inequality. If racism isn’t a particularly good explanation for income inequality in the U.S., maybe it is in other countries, and then I’m thinking in particular about some South American countries.

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