Costly signaling

For the past two weeks, we have been studying wage disparities that seem to be caused by race. With quantitative analysis tools, we can only prove that certain variable are not the cause of the disparity. Since racism is almost impossible to measure, deeming racism to be the cause of lower wages for black people must be done by proxy. If we cannot interpret wage regressions that show black people make less money when all other measurable factors are held constant as being the result of racism, it is alarming to have to conclude that black people are just less productive than other people. Therefore, researchers try to focus in on other unmeasurables that employers might be showing preference for to make them measurable. Because of this type of research, it is plausible to theorize that certain traits that are highly correlated with being black, such as speech patterns, are part of the problem.

There is research that posits that the difference in intonation between black speech patterns and white patterns is “one of the most important features for the communication of attitude in all social situations.” It goes on to explain that black speech patterns have a wider range of intonation than white speech patterns, which can lead to misinterpretation as white listeners must simplify what they are listening to in order to process it. Human nature tends to trust how something is said much more than the literal meanings of the words spoken. In a world where managers and employers are still more likely to be white, this poses a problem from black people and their wages. Professor Grogger’s recent work on black speech patterns and the racial wage gap is descriptive work that identifies that speech patterns are correlated with levels of schooling, test scores and wage disparities without identifying causality.

The speech patterns of President Obama elicit much attention. Although he occasionally draws on the historical rhetorical devices of black preaching, his accent is generally described as “normal,” which can be translated as “not black.” Early in the campaign, Joe Biden referred to then-Senator Obama as "the first mainstream African-American who is articulate and bright and clean and a nice-looking guy.” Many people believed that the combination of adjectives were implying that Obama had a chance at the presidency since he was the first black candidate whose mannerisms were white, unlike Jesse Jackson, Shirley Chisholm, Carol Moseley Braun or Al Sharpton.

With President Obama’s person being front and center in the world’s consciousness, it’s appropriate to examine the relationship between black speech patterns and success. I believe that some black people must choose to speak without a black accent as a form of costly signaling to overcome the discrimination they face as black people.

In pure economic models, the package that a worker’s skills come in shouldn’t matter. Only productivity should matter. However, the data does not support this. When regressions on wages are run that control for variables like income and education, black people still earn less than their white counterparts, either because of race or because of some other unmeasurable skill. Professor Grogger’s work indicates that one of those skills might be speech patterns since people who speak in an identifiably black way earn up to 10% less than someone who is in all other ways similar.

There are two ways to look at speech patterns in this context. The first is that it is a skill that affects productivity. In certain industries this seems plausible. Telemarketing and customer service seem likely candidates. There is a bias in this country that associates both black accents and southern accents with less intelligence and ability. In industries where voices are the only interaction consumers have with firms, the consumers’ prejudice affects actual productivity of a worker, unlike most industries where the employers’ prejudice affects the perceived costs of the work.

The second way to look at speech patterns is to see them as signals to a principal by an agent that balances the asymmetrical information problem faced by employers attempting to determine good type candidates from bad type candidates. Marianne Bertrand did work along similar lines, showing that identifiably black names negatively affect chances at getting jobs. Steve Levitt explained that this is probably because identifiably black names are statistically more likely to belong to people who were born to single mothers in poverty-stricken neighborhoods. It is not out of the realm of possibility to imagine that the same is true for black accents.

Employers who use statistical discrimination this way may not be prejudiced. Instead, they might simply be trying to increase their changes of getting an employee whose productivity is worth the wage that is being paid. Although the employer might be right on average, individual workers may be disadvantaged.

Costly signaling is a decision made by an agent to acquire credentials in order to indicate to a principal that she has other unmeasurable qualities. Although the cost is occasionally financial, it is more often opportunity cost. Agents pursue credentials at the cost of sacrificing time and energy spent on other endeavors. In the case of black speech patterns, if an employer suspected that a candidate went to bad schools or did not have the emotional stability to do the job well, lack of a black accent might communicate that a candidate had spent his time studying and assimilating, rather than taking advantage of social promotion or doing drugs.

Normatively, there might be a problem with scenario. By asking job candidates to “become white” even in scenarios when speaking black does not affect productivity, employers are affecting identity rather than simply providing wages. Economics shows us that if this model is true, adverse selection will take over and white speech patterns will ultimately become perfectly correlated with good type job candidates and people who speak in black speech patterns will be entirely unable to get a decent job. Economics has no problem with this equilibrium. However, many people, both black and white, would mourn the loss of intelligent, insightful, educated black people who create art and life through black speech patterns.

President Obama is intriguing in that in many ways, like the feminists argue, “the medium is the message.” He presents to the world an image of a black man with a Muslim name who speaks like a University of Chicago professor. He is the quintessential good type employee but he is an exception to most of the race data we have studied. The only exception is the way he speaks. President Obama chose to maintain the speech patterns of his white mother and grandmother when entering politics and this was positively correlated with getting elected. This definitely conforms to the data available.