Social Isolation and Inequality∗†

There is an increasing interest in the concept of social exclusion and the related concept of social isolation and their potential role in understanding inequality. We examine the degree to which voluntary separation from social activities during adolescence affects adult wages. It is well-known that participation in high school athletic programs leads to higher adult wages. We present empirical evidence that this premium is not primarily due to selection on predetermined characteristics valued in the labor market. ∗This is a revised version of a paper presented at a conference on Theoretical Perspectives on Identity, Community and Economic Policy, Barcelona, February 2004 sponsered by The Pew Charitable Trusts. We thank the participants of that conference for helpful comments. This work is an outgrowth of Persico, Postlewaite and Silverman (2004); it is shaped very much by conversations with Nicola Persico, which we gratefully acknowledge. †Postlewaite gratefully acknowledges support from the National Science Foundation.