Racial Inequality and Bureaucracy in U.S. Manufacturing

Amid persistent racial inequality, bureaucratic work organization promises fairness: rules and oversight limit racial prejudice. Yet research showing apparent positive effects of bureaucracy for Black workers does not adjust for worker selection. In this project, we compare Black-White earnings inequality in workplaces with two types of bureaucratic organization: structured management practices or unionization. We do so by matching a large survey of US manufacturing workplaces to employer-employee linked earnings data. Both types of bureaucratic workplaces pay relatively more to Black workers than do non-bureaucratic workplaces. This holds even within narrow industries and labor markets and among firms of a similar size and productivity level. However, bureaucracy's disproportionate pay advantages for Black workers stem largely from bureaucratic workplaces more positively selecting Black workers. For structured management practice workplaces, this is due mainly to the disproportionately lower ability of exiting Black workers, rather than to differences in hiring. This project shows how apparent inequality effects of employer practices can be driven by worker selection.

• 저널Management Science · 2024(1)
• 토픽Global trade, sustainability, and social impact · Strategy and Management
• DOI10.1287/mnsc.2023.02358
• 저자Nathan Wilmers