Bi-Ethnic Labor Markets, Mono-Ethnic Labor Markets, and Socioeconomic Inequality

Abstract

The research examines the role of local opportunity structure in the determination of social and economic outcomes by focusing on the impact of local labor market segregation on socioeconomic inequality between Jews and Arabs in Israel. Analysis of the 1983 Israeli Census reveals that the rules by which minority members achieve socioeconomic status vary considerably across bi-ethnic and mono-ethnic labor markets. Arabs working in Jewish communities (bi-ethnic labor markets) suffer the detrimental consequences of both occupational and income discrimination more than any other group. By contrast, Arabs working in Arab communities (mono-ethnic labor markets) are occupationally advantaged. With the absence of competition, they produce incumbents for positions usually held by Jews. The findings suggest that the magnitude of disadvantages that superordinate groups force on minority groups is highly dependent on the degree of group competition in the local labor market.

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