Monday, July 15, 2019

Betsey Stevenson and Justin Wolfers

Betsey Stevenson and Justin Wolfers, Subjective and Objective Indicators of Racial Progress, 4 Journal of Legal Studies 459 (June, 2012) (21 Footnoted)


ABSTRACT


The civil rights movement revolutionized the lives of blacks in the United States. A series of legal victories and public policy changes in the 1950s and 1960s outlawed de jure discrimination. These legal and policy changes--Brown v. Board of Education (37 U.S. 483 [1954] ), the Civil Rights Act of 1964, the Voting Rights Act of 1965, and the Fair Housing Act of 1968-- opened the doors to schools, jobs, housing, and private establishments that served the public throughout the country. Sociologists have argued that during this period blacks experienced large improvements in occupational status, which led to the rise of the black middle class (Wilson 1980, pp. 126-30; Thomas and Hughes 1986).

These legal and policy changes yielded improvements in the objective circumstances of the lives of blacks, particularly in the period right after the laws were passed. Donohue and Heckman (1991) study the timing of the changes in the law and labor market gains accruing to black men. They conclude that the wage gains experienced by black men relative to white men in the period from 1965 to 1975 were due to the reduction in de jure discrimination, particularly in the South. However, since then, the earnings gap by race has widened for both men and women. Altonji and Blank (1999, p. 3149) note that “although black men's wages rose faster than white men's in the 1960s and early 1970s, there has been little relative improvement (and even some deterioration) in the 25 years since then.”In the decade since their article there has been little change in the ratio of median weekly earnings of black and white men.

At the time of the legal reforms, blacks reported levels of subjective well-being that were well below those of whites. Sociologists examining data on subjective well-being have pointed to this large gap and concluded that improvements in the civil rights of blacks have had little impact on their subjective well-being despite having made improvements in objective measures. In 1986, Thomas and Hughes evaluated data from the General Social Survey (GSS), showing that “blacks score consistently lower than whites on measures of psychological well-being.”Further, they argued that “the differences between blacks and whites remained constant between 1972 and 1985.”This led them to conclude that race continues to be an important factor determining subjective well-being, “in spite of recent changes in the social and legal status of black Americans” (Thomas and Hughes 1986, p. 830). In 1998, they revisited the question and concluded that even with the longer run of data, there had been no change in the self-reported happiness of blacks (Hughes and Thomas 1998).

Yet more recent studies have found that the black-white happiness gap has shrunk since the 1970s. However, none of these studies have investigated the racial gap in happiness in depth, nor have they attempted to consider what may be behind these declines. We show in this paper that the black-white happiness gap observed in the 1970s was three times greater than that which can be explained by objective differences in the lives of blacks and whites. Moreover, differences in happiness by race were greater than differences in happiness between other groups, such as rich and poor. For instance, in the 1970s, blacks at the ninetieth percentile of the black household income distribution had as much income as a white person at the seventy-fifth percentile; however, their average level of happiness was lower than that of a white person with income at the tenth percentile. This finding is consistent with health studies that find that the health outcomes of blacks are worse than those of whites even when conditioning on income (Franks et al. 2006).

We show that there has since been substantial improvement in the happiness of blacks both absolutely and relative to whites. In the 1970s, nearly a quarter of all blacks reported being in the lowest category (“not too happy”), compared to a tenth of whites. By the 2000s roughly a fifth of blacks reported being in the lowest category, compared to a tenth of whites. Blacks have moved out of the bottom category of happiness and in doing so have become more likely over this period to report being in the top category (“very happy”). In contrast, whites have become less likely to report being very happy. While the opportunities and achievements of blacks have improved over this period, the happiness gains far exceed those that might be expected on the basis of these improvements in conventional objective measures of status.

Social changes that have occurred over the past 4 decades have in creased the opportunities available to blacks, and a standard economic framework would suggest that these expanded opportunities would have increased their well-being. However, others have noted that continued discrimination presents a barrier to realizing these benefits. And there has been little progress in closing racial gaps in many objective measures. As previously noted, there has been little progress in closing the earnings gap since 1980, the education gap has been stubbornly persistent since 1990, and unemployment disparities are little improved. In addition, health differences, such as higher infant mortality rates among blacks, have proven persistent (MacDorman and Mathews 2011; Krieger et al. 2008). Our study illustrates that the fruits of the civil rights movement may lie in other, more difficult to document, improvements in the quality of life--improvements that have led to rising levels of happiness and life satisfaction for some blacks. But these improvements have taken decades to be realized, and even if current rates of progress persist, it will take several more decades to fully close the black-white happiness gap.

Our contribution in this paper is to carefully document trends, over several decades, in subjective well-being by race in the United States, collecting evidence across a wide array of data sets covering various demographic groups, time periods, and measures of subjective well-being. To preview our findings, Section 2 shows that blacks in the United States were much less happy than whites in the 1970s and that the racial gap in happiness was greater than that which would be predicted by objective differences in life circumstances. We next show that over recent decades, blacks have become happier, both absolutely and relative to whites. Blacks continue to report lower levels of happiness compared to whites, but the gap has been systematically closing, and much of the extant gap is explained by conditioning on objective circumstances. In Section 3 we show that this fact is robust to accounting for trends in incarceration (potentially missing data) and to exploring other data sets and measures of subjective well-being. In Section 4, we consider who has received the greatest gains in happiness among blacks and how that has contributed to the closing of the racial gap. We also explore the relationship between income and happiness by race and take a look at other measures of well-being.



BETSEY STEVENSON is Associate Professor of Public Policy at the Gerald R. Ford School of Public Policy, University of Michigan; Faculty Research Fellow at the National Bureau of Economic Research; and Research Fellow at CESifo. JUSTIN WOLFERS is Professor of Public Policy and Professor of Economics at the Gerald R. Ford School of Public Policy and the Department of Economics, University of Michigan; Senior Fellow at the Brookings Institution;

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