Economists, academics, and Bank leaders gathered virtually at the Federal Reserve Bank of Boston’s 64th Economic Research Conference last week to discuss the main factors driving racial disparities in economic outcomes for U.S. workers and households. The conference, titled “Racial Disparities in Today’s Economy,” also focused on the economic areas most affected by these disparities and the policies that could change these outcomes.

The conference, which took place last Monday through Wednesday, was the series’ first-ever entirely virtual event, which gave the public a unique opportunity to join and enrich the discussion. 

Boston Fed Interim President and CEO Kenneth Montgomery opened the conference by highlighting the Bank’s long history of studying gaps in credit, employment, and wealth across race, ethnicity, and gender.

“Understanding racial disparities is essential to the Federal Reserve’s full-employment mandate,” Montgomery said.

In his welcoming remarks, Jeffrey Thompson, vice president and director of the New England Public Policy Center at the Boston Fed, underscored the value of bringing researchers together around the topic of racial disparities. 

“Economic research can both document persistent statistical gaps in populations and try to get at the root causes, which can help policymakers prioritize ways to close these observable gaps in outcomes,” Thompson said.

History and policy cannot – and should not – be separated

Keynote speaker Kerwin Charles, a professor of economics, policy and management at the Yale School of Management, opened the conference by discussing the labor market outcomes and educational attainment of Black men compared with their white peers. 

Charles stressed that researchers need to recognize that there is no single Black experience and carefully consider the social and historical construct of what is being measured. 

“The relative condition of Blacks has gotten better,” he said. “It’s been slow, even glacial, but there has been positive progress. Still, wherever we look, frustrating, large gaps remain.”  

Presentations examine persistent racial disparities in diverse sections of the U.S. economy

Across the conference’s three days, authors presented eight research papers that explored persistent racial disparities in economic outcomes. Among the presenters was University of Michigan research professor Helen Levy. Her research looks at Black/white gaps for men and women in employer-sponsored health coverage. 

Thompson and John Sabelhaus, a senior fellow at the Brooking Institution, presented research that uses a new and expanded measurement of racial wealth disparities and finds that differences in earnings account for most of the racial disparities in wealth. 

The research presented by John MacDonald, a professor of criminology and sociology at the University of Pennsylvania, focuses on the connections between arrests and police interactions and concentrated economic disadvantage – which, he noted, Black people experience more than white people. 

Closing panel considers policy solutions, explores paths forward

The conference concluded with a panel discussion on policies that can address persistent racial disparities. Lisa Cook, a professor of economics and international relations at Michigan State University, emphasized the importance of finding paths forward, even at a time when the country is divided on so many social and political issues.

“What’s at stake for this economy and the world economy if policymakers do not get this right and address these (racial) disparities?” Cook asked. “The productive capacity of the United States and the world economy, higher living standards that should follow from sustained long run growth, and greater stability.” 

Georgetown University public policy professor Harry Holzer focused his remarks on what policymakers could do to address persistent racial disparities without triggering further polarization. He encouraged honesty about the legacy of racism and class, place, and race-conscious remedies.

Glenn Loury, a professor of social sciences and economics at Brown University, concluded the panel’s formal remarks by advocating a united approach to addressing racial disparities.

“Changing the definition of the American ‘we’ is the only real solution for the racial inequality problem that afflicts our society,” he said. “That requires seeing ourselves as all being in the same boat, sharing a common citizenship and a common humanity – and not seeing ourselves as rival racial groups between whom must be brokered some kind of quid pro quo.”

Find the conference papers and video recordings of each session on the conference website.