Minority Threat, Worker Power, and Discriminatory Complaints: State-level Effects on Racial Income Inequality among Men

Abstract

Because U.S. states are meaningful polities with differing cultures and institutions, they are important locations for the struggles for resources. Yet there have been surprisingly few studies of how state-level cleavages and institutions shape the pattern of income inequality, especially by race. This article matches individual-level data on income and its determinants (from the Current Population Survey) to state-level measures (mostly from Census data) of varying demographic, power, and institutional configurations. A multilevel model of the racial pay gap is estimated showing that racial income inequality increases with the size of the minority population in the state but decreases with the rate of filing racial discrimination complaints with the Equal Employment Opportunity Commission. The index of labor market power (a scaled index of union density and the size of the public sector) increases pay across the board but does not reduce racial income inequality. The findings suggest that recent and current neoliberal efforts across states to shrink government, limit unions, and abandon enforcement of antidiscrimination will lower wages for all workers and exacerbate racial income inequality.