With his doctoral dissertation in 1955, Becker sought to understand both how discrimination would affect its victims and when discrimination’s effects would be most pernicious. Becker treated discrimination as the reflection of a taste for one group over another but recognized that not everyone had the same preferences. As a consequence, markets would ensure that the disfavored employees would work first for those companies that had the least distaste for them.
This implied that when there were large numbers of individuals in the disfavored group, their wages would be much below that of the favored group, because they would be forced to work even for those who disliked their kind. When the disfavored group had few members, the wage difference between the favored and disfavored would be very small or nonexistent because they could find employers who had little distaste for them. Thus, for example, African-Americans suffered more from discrimination than did Jews because blacks constituted a much larger population. The difference in discrimination experienced by the two groups held true even when comparing individuals with the same education and skills.
Here’s a 2011 tribute by James Heckman to Gary Becker. (HT David Levey)
Freakonomics’s Steven Levitt remembers Gary Becker. (HT Tyler Cowen)