Racial Identity Production Dynamics and Persisting Wealth Differentials: Integrating Neo-Institutionalist Perspectives into Stratification Economics

In: The review of black political economy: analyzing policy prescriptions designed to reduce inequalities, Volume 37, Issue 3-4, p. 217-222

Abstract

This study advances the analysis of factors contributing to the persistence of the black-white racial wealth gap using insights from Institutional Economics and Stratification Economics. The analysis challenges discourses trumpeting the emergence of a post-racial society in which previous barriers to attaining equal economic outcomes have been eliminated. It is argued that the post-racial rhetoric conveys inaccurate information to agents regarding the expected returns from investments in both capital assets and racial identity. Sub-optimal decisions by Black agents result, in part, from failure to take advantage of cultural knowledge about more advantageous investment strategies tied to indigenous cultural traditions.