Chapter 8 reviews the major issues of “conditioned choice” and discrimination both in the provision of education and in labor markets. The chapter makes the case that if there are structural relations in society that “condition” individual behavior, access to information, and available likely options for investing in human capital, and if this “conditioning” varies among groups in society, the role of individual “free” choice in investing in academic and productive skills is much more limited, and we need very different explanations for the relationship of education to earnings. Structural limits on choice can come from various sources. Two important instances of such conditioned choice and its possible implications for labor market earnings differences are studied. The first regards gender differences in earnings, and the second, racial differences in earnings. The chapter reviews the arguments by some economists that both gender and race earnings gaps are the result of productivity differences between males and females and Black and White workers, and of other arguments that they are largely the result of discriminatory practices.
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