This paper studies the source of differences in wage growth between young black and white workers. Focusing on "terminal" high school graduates from the National Longitudinal Survey of Youth, we estimate the returns to on-the-job tenure and general labor market experience using ordinary least squares, Altonji and Shakotko, and Topel estimators. Results from all three estimators indicate that returns to general experience for black workers trail those for white workers, but that black workers earn equal if not higher returns to tenure than do white workers.

Bernt Bratsberg is an associate professor of economics at Kansas State University. Dek Terrell is an associate professor of economics at Louisiana State University. The authors thank Joe Altonji, Jim Ragan, Steve Trejo, and two anonymous referees for helpful comments. The data used in this article can be obtained beginning November 1998 through October 2001 from Bernt Bratsberg, Department of Economics, Kansas State University, Manhattan, KS 66506, or from Dek Terrell, Department of Economics, Louisiana State University, Baton Rouge, LA 70803.