Social-Scientific and Legal Challenges to Education and Test Requirements in Employment

Human capital theory suggests that education and test scores are related to earnings because they are related to productivity. Competing theories disagree, claiming that education and test scores are used as employment criteria either for convenience or because they exclude members of groups employers wish to discriminate against. This paper examines how this social science controversy comes to have practical implications in equal employment opportunity cases decided by the federal appellate courts. In such cases, employers can sometimes be forced to try to demonstrate that their requirements are related to productivity, and the cases become occasions for testing the competing theories in a legal context. An examination of how education and testing requirements fare in federal appellate court decisions shows that employers are seldom able to provide convincing evidence that education and test scores are related to productivity.