This paper examines the relationship between contemporary racial inequality of schooling and the black-white wage gap in the U.S. In particular I ask: what policies would be effective at reducing the black-white wage gap in the U.S.? In order to address this question, I develop a model of human...

The model developed in this paper illustrates how grade repetition and unemployment shocks may culminate in a skill gap and consequently a wage gap across races. I calibrate the model to South African data in the early 1990s, and use this calibrated model to provide insight into the quantitative...