Intracohort Trends in Ethnic Earnings Gaps: The Role of Education

Abstract

This study demonstrates that studying ethnic/racial inequality on the basis of cross-sectional data conceals how such inequality might unfold over the life course. Moving beyond a snapshot perspective, we ask, Do Israel's Jewish ethnic groups differ in their long-term earnings trajectories? Analyzing nearly 20 years of registered earnings data, the authors find that for the same cohort (25-to 32-year-old Jews in 1995), the ethnic earnings gap has widened over these years. This trend, we demonstrate, is explained largely by increasing wage premiums for college degree, even when these premiums are ethnicity blind. That is, ethnic inequality in educational attainment is translated to increasing ethnic earnings inequality over the life course. This pattern cannot be detected in previous research in Israel, which relied on the snapshot perspective on the basis of cross-sectional data. The consequences of these findings for changes in inequality in divided societies are discussed.

Short and long-term consequences of high-school tracks for earnings in Israel

“…As in the previous analysis, we apply multi-level models in which person-age is nested in individuals, estimating earnings trajectories in each educational path for men and women separately. Since recent scholarship has shown that the earnings trajectories of the two Jewish groups have fanned out over the life course 10 , but that the returns to education are also identical for both sub-populations (Yaish and Gabay-Egozi, 2019), we have included in our model two-way interaction terms between ethno-religious groups and age and ethno-religious groups and age 2 to capture this fanning out trend. This model, then, explores the possibility that the three ethno-religious groups share similar returns to educational paths (the three-way interaction terms-ethno-religious group, path, age-did not reach an acceptable statistically significant level for either men or women), but that earnings inequality between the ethnoreligious groups changes, as suggested by Yaish and Gabay-Egozi (2019).…”

How does economic growth impact on income inequality across ethnic groups in Malaysia?

“…Income inequality, in some respects, is visible in the field of education as well. Studies (e.g., Yaish & Gabay‐Egozi, 2019) show that inequality in education brings inequality in earnings that hinder a country's growth. Thus, like other multiracial countries, Malaysia should focus on such education where every individual disregard of their ethnicity will freely enjoy equal opportunity.…”

“…However, such a trend of income inequality is on an upward trajectory. The empirical study of Yaish and Gabay‐Egozi (2019) finds that in Israel, the earning gap among the ethnic group has been in ascending order, though the study of Ravallion (2018) says that overall income inequality in the international context is in descending direction in the recent years. Income inequality refers to economic inequality that reflects in political and social inequality too.…”

“…Sometimes income inequality is the result of inequality in education. The empirical study of Yaish and Gabay‐Egozi (2019) shows that in Israel there is a vibrant gap in earnings between Ashkenazi and Mizrachi Jews because of ethnic inequality in education. This study implies that inequality in any corner of life brings so many inequalities in the society that breach mutual understanding and harmonious relationships among the people.…”

An Empirical Model: Jewish and Muslim Women Students in Israel Gaining Empowerment Through Higher Education

“…The Educational Review, USA religious community, which denies them an equal position. Their status rises not only within their own family, but also within their communities-even within Jewish and Muslim orthodox religious communities, which are quite determined to exclude women from sources of power (Aish & Gabay-Egozi, 2019;Khurshid, 2019;Neal, 2014). The significant differences in gender empowerment found between Jews and Muslims, with higher rates among Muslims, and between non-religious and religious women, and also with higher rates among religious women, can be explained by the fact that non-religious students, by opting for higher education, marked the beginning of their gender empowerment, completing the entire process during their studies.…”