Transcript Gender Wage Gap

Gender Wage Gap:
Systemic Explanations &
Social Elasticity in the U.S.
Elizabeth O’Neill, ECON 539, 6.4.07
Central Questions:
What evidence documents the wage gap between male
and female full-time wage earners?
How is the wage differential measured through various
economic models?
What are the systemic reasons for the inequitable pay
distribution between women and men?
Key Sources:
• Blau, F., Ferber, M. & Winkler, A. (1998) The Economics of Women, Men &
Work, 5th edition. Uppersaddle River: Prentice Hall.
• Karamessini, M & Ioakimoglou, E. (2007).Wage Determination & the
Gender Pay Gap: A Feminist Political Economy Analysis & Decomposition.
Feminist Economics. 13(1): 31-66.
Literature Review Structure
Definition & evidence of gender wage gap
 Social elasticity models of measurement
 Summarizing reasons leading to the gender wage gap:
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Macroeconomic factors
Industry specific trends
Employer-based discrimination
Employee-based causative factors
Brief analysis of literature reviewed
Wage Gap Defined
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Examines wage differentials between men & women
who are performing similar paid work, with two
different assumptions: equal conditions and systemic
differences.
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Undisputed consensus regarding the gender wage gap
but viewed as either persistent discrimination or
cohort-based.
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Female-to-male earnings ratio ranged from
57% to 81% since WWII.
Social Elasticity
 Construction
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Neoclassical Economic Theory
 Human
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of Wage Differentials
Capital Theory
Occupational Crowding Theory
 Determined
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by % female within occupations
Feminist Marxian Analysis
Macroeconomic Determinants
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“Feminization of Labor”
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Concentration of low-wage, low-skilled jobs based on
expectations of women’s unpaid labor
Reinforces gender differences
U.S. transition from goods to service based economy
*Occupational Segregation
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Strong demonstration that female-dominated occupations
depress wages for both men and women
Industry-Based Factors
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Changes in public sector employment
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More women employed in public sector equates to a
lessening of the wage gap
Contributing factors are varied occupational distribution,
attention to nondiscriminatory recruitment and retention
efforts, and higher unionization rate.
Level of unionization
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Higher unionization rates improves low-skilled women’s
wages
De-unionization depresses men’s wages but not women’s,
resulting in a lessening of the gap by proxy
Employer-Based Factors
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Starting wage divide
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Slight difference at start of career, but exponentially grows
Unequal promotion and compensation rates
 Organization size:
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Wage gap in small organizations: 29%
Medium: 15%
Large: 17%
Larger: 24%
Differences explained by level of educational returns and
access to supervisory positions
Employee-Based Factors
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Workforce participation gaps: Women’s wages have
increased with delayed marriages and lower fertility
rates
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Lack of educational investment
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early education (HS pro technical, math)
later education (college attainment)
Negotiation skill disparity contributing to inequitable
starting wages
Summary of Influential Factors
Percentage of wage gap (dependent) =
βo + γ1(percent female within occupation) +
γ2(educational attainment level) + γ3(continuity of
employment) + γ4(on-the-job training access) +
γ5(union participation) + γ6(public sector) +
γ7(starting wage) + γ8(access to job mobility) +
γ9(access to supervisory positions) +
γ10(organizational size) +
γ11(labor force continuity) + γ12(educational
investments)
Analysis of Reviewed Literature
Cohort perspective would take six decades to
reconcile the gender wage difference, longer if
economic trends influence the current projections.
Persistent discrimination is a complex relationship;
researchers largely believe remnants remain.
Measuring the wage differential will need to
incorporate demonstrated attenuating variables.
Policy Implications
The most equitable competitive equilibrium
will require continued government intervention
for both supply and demand sides of labor.
Current national policies address employerbased discrimination; further attention needed for
systemic, industry-related, and individual-based
causations.
Questions?