http://www.nber.org/papers/w22748
Asian Americans are the only non-white US racial group to experience
long-term, institutional discrimination and subsequently exhibit high
income. I re-examine this puzzle in California, where most Asians
settled historically. Asians achieved extraordinary upward mobility
relative to blacks and whites for every cohort born in California since
1920. This mobility stemmed primarily from gains in earnings conditional
on education, rather than unusual educational mobility. Historical test
score and prejudice data suggest low initial earnings for Asians,
unlike blacks, reflected prejudice rather than skills. Post-war declines
in discrimination interacting with previously uncompensated skills can
account for Asians’ extraordinary upward mobility.
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