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The economics of Race, a new book that yields context to a complex topic

BY lyanne

How does Race play a role in the Economy? Now  there is a new book that attempts to quantify this, while yielding a better understanding as to  how economics is impacted by race.   Its author presented his publication last Wednesday at the newark library to a well attended discussion.  Columbia University Professor of Economics, Brendan O’Flaherty (known by many as Dan) outline the thesis of his just release book entitled, “The Economics of Race in the United States, by Harvard University Press.  A Newark native, Dr. O’Flaherty has been an active voice within the community, as he puts it “I am a Newarker, I was  born here, raised here, married here and worked here in Newark”. Dr.  O’Flaherty has been  teaching a course on race and Economics at the University to Graduate students obtaining their degree in Economics.  His intention for the book is to provide a tool to academia as a text book for teaching the subject. Within the body of the book, he  brings the tools of economic analysis—incentives, equilibrium, optimization, and more—to bear on contentious issues of race in the United States. In areas ranging from quality of health care and education, to employment opportunities and housing, to levels of wealth and crime, he shows how racial differences among blacks, whites, Hispanics, and Asian Americans remain a powerful determinant in the lives of twenty-first-century Americans. More capacious than standard texts, The Economics of Race in the United States discusses important aspects of history and culture and explores race as a social and biological construct to make a compelling argument for why race must play a major role in economic and public policy. People are not color-blind, and so policies cannot be color-blind either. Because his book addresses many topics, not just a single area such as labor or housing, surprising threads of connection emerge in the course of O’Flaherty’s analysis. For example, eliminating discrimination in the workplace will not equalize earnings as long as educational achievement varies by race—and educational achievement will vary by race as long as housing and marriage markets vary by race. No single engine of racial equality in one area of social and economic life is strong enough to pull the entire train by itself. Progress in one place is often constrained by diminishing marginal returns in another. Good policies can make a difference, and only careful analysis can figure out which policies those are. This book is so ever timely, when last years data reported that during and coming out of the great recession that african American with respect to wealth creation has decline.

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The most comprehensive data we have on racial inequality comes from the Federal Reserve Board’s triennial Survey of Consumer Finances. The recently released latest edition, covering 2010, offers an updated glimpse into race and inequality against the yardsticks of both income and net worth. The racial gap in median income has closed slightly over the last 20 years. Nonwhite families earned about half of what white families earned in 1989. This closed to 70 percent in 2007 and slipped back to 65 percent in 2010. But the gap in assets runs much wider. White families claim about six times the net worth of non-white families, a gap that has changed little over the past generation. The gap in median home value, for white and nonwhite homeowners, narrowed through the housing boom. In 2007, the median nonwhite-owned house held 90 percent of the value that the typical white-owned house held. But the crash saw a sharper decline in both nonwhite housing value and nonwhite rates of homeownership. In 2010, the median primary residence for all nonwhite families, not just homeowners, had about half the value of the homes of white families.

Now “The Economics of Race in the United States”,  is not the first critical book to highlight the economic conditions of Blacks.  In the ’70s a book entitled Race and Economics by Thomas Sowell attempted to analyzes the relationship between race and wealth in the United States, specifically, that of blacks.  He makes three basic arguments. First, he examines the economic impact of slavery, in the United States, the West Indies, and elsewhere. He distinguishes rural slavery from urban slavery, and circumstances in which blacks so predominated that many economic tasks fell to them of necessity, from circumstances in which blacks were punished for initiative and the development of skills. Next, he compares the economic skills, circumstances, and successes of American blacks, other blacks, Puerto Ricans, Chicanos, Jews, Irish, Italians, Scots, and other ethnic groups.  His third argument criticizes past governmental and economic policies, and opens up questions for the future. He has criticisms to make of liberals, radicals, and conservatives, each of whom, he finds, protect their favorite illusions with respect to blacks.   Unlike Sowell,  O’Flaherty doesn’t critique the failings of US government programs directly, but rather approaches contemporary topics by applying data sets and econometrics to determine whether topics are affected by race, and their relations to race, with ten chapters analyzing areas, of health, labor, immigration, education, social interaction, marriage, housing and neighborhoodshomeownership, crime businesses, and entrepreneurship and wealth.  While Sowell places much of his text on the impacts of slavery, O’Flaherty focus on more recent data to determine direct and indirect correlations while slavery implication is summarized in a chapter discussing the merits of reparations.  other groups in general, his analyses book signing event at the newark public library ties these issue and others in a comprehensive book, entitled the Economics of Race.  This book is uniques in that it brings empirical study to the impacts of race or black race specifically.   Another difference is its “A terrific contribution to the literature on race and economics

Also speaking at the book signing was Newark historian Bob Curvin Phd, and SEIU union leader Milly Silva.  Each discussed the unique takeaways from the book that were thought provoking.  One such example was that random drug testing data concluded that Blacks don’t take as much drugs has the stereo type suggest and whites have the highest morality rate of drug abuse.  Another interesting conclusion, were Hispanic and upper class Black ate healthy meals.  Minorities were more likely to be obese, with almost a half Black females being classified as obese.  Another surprising fact regarding Black women was over the decades they are becoming shorter.

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Its a great book

.”—Ingrid Gould Ellen, New York University “An amazing book that should become a standard reference and must-read text for economists and other social scientists who study race and racial inequality. It is both deep and comprehensive, and has several blinding insights relating racial inequality to the fundamental workings of society.”—Steven Raphael, University of California, Berkeley

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