This study calculates the degree of substitutability between white and nonwhite labor within various occupational categories, in order to determine the extent of racial discrimination and to derive demand curves for nonwhite labor. The model developed in the study treats employer discrimination as a differential between total and money costs to the employer of hiring a nonwhite, whereas employee and consumer discrimination are incorporated into the firm's isoquant. The model avoids the restriction of the Cobb-Douglas production function, assuming only that the function has constant elasticity of substitution between capital and labor. The study concludes that when quality differentials are removed, whites and nonwhites are perfect substitutes, implying that the work force will be totally segregated when there exists a nonzero discrimination coefficient, which measures the utility or disutility of hiring nonwhites. The frequency of integrated firms indicates that many employers and employees have zero discrimination coefficients. The results are useful aids in choosing the proper policy instruments to raise the nonwhite wage rate. This Ph.D. dissertation was submitted to Washington University. (BH)