Does the government have a right to determine the employment practices of private companies; does a marketplace in which people trade without restriction is inherently unfair and hinders diversity. Today, the government dictates the terms on which labor can be traded in the workplace. In some cases companies that look for the best qualified may reflect an irrational bias such as racism or sexism. But an employer's natural impulse is to hire the best available employee and, thus, make more money.
It is worth pausing to consider what we know about the nature and extent of employment discrimination. The most extensive attempts to measure employment discrimination have generally been produced by labor economists in the form of hiring, wage, or occupational achievement differentials, audit-pair studies, and the volume of employment discrimination litigation. The different methods seek to isolate differences in wages or promotion between different race or gender groups using actual market data. The audit-pair approach is roughly an experimental method that seeks to pair individuals that are similar along all dimensions except race or gender, and then examine whether hiring, promotion, or salary outcomes differ. Another collection of studies explore how the volume of employment discrimination changes over time. Understanding all of this evidence varies. The market disparities must be distinguished from market discrimination and that much of the evidence is subject to practical criticism. The evidence indicates that earnings differentials between blacks and whites in the 1990's are
due to differences in skill than to discrimination within the labor market. Indeed, the race or gender differentials in employment are due in part to ...