Why are women paid less – interview with labor economist Francine Blau

The Atlantic has an interesting interview with  Francine Blau, a labor economist at Cornell, about the male-female wage gap. Here are some highlights:

  • In 1950, women earned about 60% less.
  • Today, that figure is around 77%.
  • Adjusting for human capital brings the gap down slightly (from 23 to 19%) and controlling for industry brings it down to 9%.
  • Blau brings up some good points about how these adjustments may result in understating the gap (if women have better unmeasured skills such as interpersonal skills or if industry choice is endogenous/related to discrimination in various industries). On the other hand, she brings up potential employer concerns about future commitments and time availability in response to the following question:

What about the role of motherhood? How much does that really impact women’s earning potential, and to what degree?

I don’t think we completely have the answer to that. But one way it does is something we were able to control for, and that is it influences how much prior work experience a person has. Because in the old days, women used to drop out of the labor force for extended periods of time when they had children, and that has changed a great deal. But that disruption certainly lowered the earnings of women compared to men, that dropping out. Now I think think it’s more subtle. Especially in very high level jobs, it’s how much commitment can you give? Are you working 10 to 15 hours a day? It’s not just a question of full time, but above and beyond, 60 hours a week. So it could be influential there. It could impact what occupations and industries women go into as well. It might make it more difficult in some that are actually higher paying.

So I think that there’s no question that if we want to improve outcomes for women, we have to look at these work family issues and see how we can help accommodate balance without major detriment to either sphere. One concern I have is that some policies that are designed to help balance work and family have a tendency to push women on to a mommy track, off the main drag.

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About ozidar

I'm an Assistant Professor of Economics at the University of Chicago Booth School of Business and a Faculty Research Fellow at National Bureau of Economic Research. You can follow me on twitter @omzidar. http://faculty.chicagobooth.edu/owen.zidar/index.html
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