Racial Income Inequality and Public Sector Privatization

Source: George Wilson, Vincent J. Roscigno, Matt Huffman, Social Problems, First published online: 4 May 2015
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From the abstract:
Social science accounts have only recently begun to recognize “new governance” shifts, including, but not limited to, privatization occurring in public sector institutions (e.g., education, prisons, the military) and in the functioning of federal and state sector jobs. This article, which presents unique analyses of wages across time using the Panel Study of Income Dynamics (PSID) and retested on similarly representative data from the Integrated Public Use Micro Sample (IPUMS) and the American Community Survey (ACS), examines the extent to which these changes have generated significant inequalities for African Americans relative to whites. Most important, our results show that the relative racial parity in wages that once existed in public sector employment has eroded in the face of new governance, and racial inequalities for both men and women have intensified. Supplementary and decomposition analyses further highlight the potential escalation of discrimination as a core mechanism under new governance. Along with discussing the short- and long-term implications, we conclude by suggesting an important corrective to stratification scholarship—a corrective that highlights what structural transformation may mean for inequality and that recognizes important shifts that have made the public sector, much like the private sector, a locus of contemporary racial disadvantage.