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If a business is located in an area with a large minority population and refuses to sell to minorities, it will cut into its own profits. If some businesses run by bigoted employers refuse to pay women and/or minorities a wage based on their productivity, then other profit-seeking employers can hire these workers. In a competitive market , if the owners of a business care more about the color of money than about the color of skin, they will have an incentive to make buying, selling, hiring, and promotion decisions strictly based on economic factors.

The power of markets to offer at least a degree of freedom to oppressed groups should not be underestimated. In many countries, cohesive minority groups like Jews and emigrant Chinese have managed to carve out a space for themselves through their economic activities, despite legal and social discrimination against them. Many immigrants, including those who come to the United States, have taken advantage of economic freedom to make new lives for themselves. However, history teaches that market forces alone are unlikely to eliminate discrimination. After all, discrimination against African Americans persisted in the market-oriented U.S. economy during the century between President Abraham Lincoln’s Emancipation Proclamation, which freed the slaves in 1863, and the passage of the Civil Rights Act of 1964—and has continued since then, too.

So why does discrimination persist in competitive markets? Gary Becker sought to explain this persistence. Discriminatory impulses can emerge at a number of levels: among managers, among workers, and among customers. Consider the situation of a manager who is not personally prejudiced, but who has many workers or customers who are prejudiced. If that manager treats minority groups or women fairly, the manager may find it hurts the morale of prejudiced co-workers or drives away prejudiced customers. In such a situation, a policy of nondiscrimination could reduce the firm’s profits. After all, a business firm is part of society, and a firm that does not follow the societal norms is likely to suffer. Market forces alone are unlikely to overwhelm strong social attitudes about discrimination.

Visit this website to read more about wage discrimination.

Public policies to reduce discrimination

A first public policy step against discrimination in the labor market is to make it illegal. For example, the Equal Pay Act of 1963 said that men and women who do equal work at a company must be paid the same. The Civil Rights Act of 1964 prohibits employment discrimination based on race, color, religion, sex, or national origin. The Age Discrimination in Employment Act of 1967 prohibited discrimination on the basis of age against individuals who are 40 years of age or older. The Civil Rights Act of 1991 provides monetary damages in cases of intentional employment discrimination. The Pregnancy Discrimination Act of 1978 was aimed at prohibiting discrimination against women in the workplace who are planning to get pregnant, are pregnant, or are returning after pregnancy. Passing a law, however, is only part of the answer, since discrimination by prejudiced employers may be less important than broader social patterns.

Questions & Answers

What is a monopsony?
Allan Reply
economic is tha process of banking
hashmat Reply
Pls can u explain it into details
Praise
Cause I don't understand what you are saying
Praise
brownies price is 5$ quantity demand is 5000$ supplied is 3000 if brownies are not taxed how many are consumed?
Fel Reply
what is unemployment
Rita Reply
ok so what would u say is supply in your own terms
Odessa Reply
Ok
fedaa
ya
Lal
why the demand curve is downwards sloping and supply upward sloping
Odessa Reply
the dd curve is downward sloping because consumers dd less when price is high and vice versa the ss curve is upward sloping suppliers are willing to produce more when prices are high
Clifford
what is dead weight loss
jeremy
when the prices of supplies slop upward then the prices of demand curve will increases downward
Kerubino
Why scarsity is considered to be very important in the study of economics
Sesay Reply
How can you solve the problem of scarcity
Sesay
If there is a enough quantitative the problem of scarcity would be solved.
Kerubino
what is demand
aliyu Reply
Demand refers to the quantities of a commodity which consumers are willing and are able to buy at given prices.
Okonji
demand is the number units of goods or services that buyers are willing and able to buy at verous prices
muhiyadiin
what is a full form of GDPCP?
Sadhna Reply
if the price of a commodity is at 6$, is the magnitude of the excess supply
Emma Reply
The quantity supplied at a price above or higher than $6 would be the excess supply
Elisha
2003, and $12,700 in Korea. Assume the growth rates for each country remain the same. 1. Compute the doubling time for
busywork
6$ the quantity remained the same
Sekou
write shirt note of the following terms normal goods
Adamu Reply
what is normal goods
Adamu
what is a full form of GDPCP?
Sadhna
evaluate measures to remove the deflationary gap?
Tinotenda Reply
State four importance of economics
School Reply
1) Economics help us to know how gouvernement,society, individuals and house holds allocate scarce resources 2)Economics help give us valable knowldge on daily decisions 3)Economics also help us to better understand economy 4)Economics help us better our daily life
Blessing
thank you dr
BLESSED
what is scarcity?
MCclean Reply
what is economics
MCclean
why is economics not consider as pure science?
Stanly
Economics is defined as science that studies human behaviour as a relation between ends and scarce means
School
Economics is not considered as pure science because it only deals with currency and human behaviour...
School
Scarcity refers to a limited supply of goods and services
School
What is Stock exchange?
Rock Reply
An exchange where security trading is conducted by professional stockbrokers
Bnysn
A place where scurity trading is conducted on an organised system
Blessing

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Source:  OpenStax, Principles of economics. OpenStax CNX. Sep 19, 2014 Download for free at http://legacy.cnx.org/content/col11613/1.11
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