The Review of Black Political Economy

, Volume 14, Issue 1, pp 67–74 | Cite as

Human capital: A critique

  • Stephen Steinberg


The human capital approach increasingly has been absorbed within the folds of cultural determinism. The trend has been so pronounced that it prompted the organization of a session at the December 1984 American Economic Association meetings in Dallas, Texas, entitled “Human Capital and Culture: Analyses of Variations in Labor Market Performance.” The papers from that session are available in the May 1985 issue of theAmerican Economic Review. One of the discussants for the session was Stephen Steinberg, a sociologist at Queens College. Steinberg was invited to comment on the presented papers for two major reasons—first, he had written an outstanding study that debunked many of the conventional linkages made between culture and ethnic achievement,The Ethnic Myth, and second, as a sociologist, he was expected to provide a perspective on the subject quite different from the rest of the panelists, all of whom were economists. In the midst of the coven of economists, Steinberg appeared well armed. He arrived with his own paper, a paper that went far beyond comments on the presented papers. Unfortunately, the current rules governing the inclusion of papers in the AEA proceedings prohibit publication of the discussants’ remarks. Fortunately, Steinberg graciously has consented to have the paper appear in theReview of Black Political Economy.


Human Capital American Economic Review Black Political Economy Human Capital Theorist Human Capital Approach 
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  1. 1.
    Barry R. Chiswick, “The Earnings and Human Capital of American Jews,”Journal of Human Resources, vol. 28, no. 3 (1983), pp. 313–36.CrossRefGoogle Scholar
  2. 2.
    James Smith, “Race and Human Capital,”American Economic Review, vol. 74, no. 4 (September 1984), pp. 685–98. For a critical review of studies that invoke human capital theory to explain income differences between blacks and whites, see William A. Darity, Jr., “The Human Capital Approach to Black-White Earnings Inequality: Some Unsettled Questions,”Journal of Human Resources, vol. 17, no. 1 (1982), pp. 72–93. Also see William A. Darity, Jr. and Rhonda M. Williams, “Peddlers Forever? Culture, Competition, and Discrimination,”American Economic Review, vol. 75, no. 2 (May 1985), pp. 256–61.Google Scholar
  3. 3.
    Thomas Sowell,The Economics and Politics of Race (New York: William Morrow & Co., 1983), p. 249.Google Scholar
  4. 4.
    This is not a simple oversight. Economists who have applied the human capital approach generally rely on U.S. Census data or other official surveys. In the tradition of Gary Becker’s early studies, the main thrust of these studies is to explore differences in income and return to education. Whatever differences are found by race, religion, or ethnicity are then assumed to reflect cultural factors endemic to these groups. The problem, from a methodological standpoint, is that the data at hand do not allow this critical assumption to be put to an empirical test.Google Scholar
  5. 5.
    Thomas Sowell,Ethnic America (New York: Basic Books, 1981), p. 187, italics added. A few pages later, Sowell elaborates further: “Lack of initiative, evasion of work, half-done work, unpredictable absenteeism, and abuse of tools and equipment were pervasive under slavery, and these patterns did not suddenly disappear with emancipation” (p. 200). And in a concluding chapter: “Groups today plagued by absenteeism, tardiness, and a need for constant supervision at work or in school are typically descendents of people with the same habits a century or more ago” (p. 284).Google Scholar
  6. 6.
    Stephen Steinberg,The Ethnic Myth: Race, Ethnicity, and Class in Ameria (Boston: Beacon Press, 1983), chap. 3.Google Scholar
  7. 7.
    Sowell,The Politics and Economics of Race, p. 255.Google Scholar
  8. 8.
    Moses Rischin,The Promised City: New York Jews, 1870–1914 (Cambridge, Mass.: Harvard University Press, 1962), p. 59.Google Scholar
  9. 9.
    It is true, of course, that later generations of Jews “invested” in education, which allowed them to reach higher rungs of the occupational ladder. However, as historian Selma Berrol concluded from her research on education and economic mobility in New York City between 1880 and 1920: “Most New York City Jews did not make the leap from poverty into the middle class by going to college. Rather, widespread utilization of secondary and higher educationfollowed improvements in economic status and was as much a result as a cause of upward mobility” (“Education and Economic Mobility: The Jewish Experience in New York City: 1880–1920,”American Jewish Historical Quarterly vol. 65, no. 3 [March 1976], pp. 257–71). For a general treatment of education and ethnic mobility, seeThe Ethnic Myth, chap. 5.Google Scholar

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© Springer 1985

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  • Stephen Steinberg

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