What is causality? Why do we care about it? And why do economists and researchers spend so much time obsessing over it?
It’s because causality gives society and policy makers the ability to make inference about a given set of factors. In mathematics, the simple, elegant equation
(1) y= f(x)
yields causal inference explicitly. Equation (1) gives a lot of information. It says that some set of inputs x, in some functional form, denoted as f(.), yields output y. As an example, consider the case of computers. Computers have inputs such as processors, hard disks, and random access memory that are combined to produce the output; i.e., computers. In this simple framework, we have causality. We can cause these set of inputs x, to produce y. But, remember, it does depend on f(.).
Why is this important to racial inequality? Well, because some might argue that the reason ethnic minorities suffer from lower socioeconomic outcomes is because they cause them. That is, the intrinsic effect of being an ethnic minority leads one to have a lower socioeconomic outcome. Informally, this suggests that Blacks have the lowest wages because they’re Black; that Hispanics are the least educated in America because they’re Hispanic; Blacks and Hispanics have the highest crime rates because of their skin color, and no other reason than their racial background. These statements, are incorrect.
Yet, the latter claim I presented above was, in fact, made by an organization known as the New Century Foundation (Here’s the link). They did an independent study and suggested that,
- Blacks are seven times more likely than people of other races to commit murder, and eight times more likely to commit robbery.
- When blacks commit crimes of violence, they are nearly three times more likely than non-blacks to use a gun, and more than twice as likely to use a knife.
- Hispanics commit violent crimes at roughly three times the white rate, and Asians commit violent crimes at about one quarter the white rate.
- The single best indicator of violent crime levels in an area is the percentage of the population that is black and Hispanic. (New Century Foundation )
While these statements are informative, they are not causal effects. But, how do I know? How can I causally say that Blacks and Hispanics don’t suffer from these socioeconomic problems, and that they don’t commit these crimes because they have, as I was once so eloquently told, “shit morals.”
Because of research. Empirical evidence has given much information about the socioeconomic problems ethnic minorities face. A simple abstract offers a very useful retort to the New Century Foundation’s work.
“There has been no satisfactory analysis of arrest and offender rates comparing ethnic groups controlling for relevant social factors. Reearch is needed to investigate possible disparities in the treatment of the ethnic minorities throughout the criminal justice system.” (Walker  p. 39)
Moreover, Lance Lochner and Enrico Moretti  found that the more schooling a particular person achieved, the less likely they were to be incarcerated. Finally, Cameron and Heckman  estimated that, after controlling for parental income, Blacks and Hispanics were more likely to graduate from high school and attend college than Whites.
So, it is not being a minority that causes minorities to suffer socioeconomic problems, it is simply the consequence of growing up poor*. Socioeconomic upbringing is the problem, and not being a raical minority.
Post Script: As a minor edit, I realize that I wasn’t very explicit about how Heckman and Cameron  and Lochner and Moretti  are able to treat their effects as causal; allow me to elaborate very briefly. Lochner and Moretti  use a very wonderful statistical method (yet slightly complicated so I’ll leave out the details [Here’s the link to the paper]) to tease out causality. Heckman and Cameron  are less willing to suggest causality (Here’s the link to the paper).
Post Post Script: Any hostile comments will be removed, and I won’t dedicate time to respond to them; nor will I respond to retorts citing other blog posts. The information I present in these blog posts will be from peer reviewed (Often Tier 1) academic journals. I trust blogs for summaries of cited research, that’s what I will present here, and that is all I will respond to.
*I would just like to note that in no way am I implying that all minorities are poor, this was in regards to the fact that, on average, those in poverty are minorities.
 New Century Foundation. 2005. “The Color of Crime.”
 Walker, Monica, 1987. Interpreting Race and Crime Statistics. Journal of the Royal Statistical Society. 150 (1): 39-56.
 Lochner, Lance, and Enrico Moretti, 2004. The Effect of Education on Crime: Evidence from Prison Inmates, Arrests, and Self-Reports. American Economic Review. 94 (1): 155-189.
 Cameron, Stephen V, and James J. Heckman, 2001. The Dynamics of Educational Attainment for Black, Hispanic, and White Males. Journal of Political Economy. 109 (3): 455-499.