Intracohort Trends in Ethnic Earnings Gaps: The Role of Education

This study demonstrates that studying ethnic/racial inequality on the basis of cross-sectional data conceals how such inequality might unfold over the life course. Moving beyond a snapshot perspective, we ask, Do Israel’s Jewish ethnic groups differ in their long-term earnings trajectories? Analyzing nearly 20 years of registered earnings data, the authors find that for the same cohort (25- to 32-year-old Jews in 1995), the ethnic earnings gap has widened over these years. This trend, we demonstrate, is explained largely by increasing wage premiums for college degree, even when these premiums are ethnicity blind. That is, ethnic inequality in educational attainment is translated to increasing ethnic earnings inequality over the life course. This pattern cannot be detected in previous research in Israel, which relied on the snapshot perspective on the basis of cross-sectional data. The consequences of these findings for changes in inequality in divided societies are discussed.