Political Economy of Race, Class and Gender Essay

Political Economy of Race, Class and Gender - Essay Example 14). They aim at explaining the reason behind large numbers of unemployed and underemployed blacks relative to whites and the wage gaps between blacks and whites and between genders. This paper discusses the salient differences between these two models; the neoclassical economics theory and the political economy models of the labor market. It includes a discussion on the importance of the differences in the realm of race and gender while highlighting the critiques of neoclassical presumption by political economists. In neoclassical economics, discrimination is analyzed in simplicity using the same implements used to understand market behavior. Discriminators here are either maximizing their welfare or minimizing any apparent risk (Albelda et al. 36).Under this model, discrimination in the labor market is not a long-term phenomenal. Discrimination in the labor markets takes the form of higher wages for white workers relative to black workers equipped with similar skills and carrying out similar productive jobs under similar working conditions; job segregation of blacks into lesser-paying jobs; and high unemployment rates for blacks relative to whites (Albelda et al. 60). The wide persistence of discrimination is attributed to low competition among firms and workers and incomplete information in the labor market. Employers taste leads to higher costs as it hampers competition among workers. The discriminating firms directly cover these higher costs by paying higher wages for labor power. According to neoclassical economics, this approach of discrimination is efficient in allocation of scarce resources in the labor markets by the discriminating firms (Albelda et al. 65). Neoclassical economic models assume that competition combined with employers’ diversity in tastes eradicates labor market discrimination. A competitive market will increase