Wednesday, March 11, 2009

Market Forces Prevent Widespread Discrimination

Myth: Women Earn Less than Men in America

Fact: It is true that women, on average, earn less per year than men do. It is also true that 22-year-olds earn less, on average, than 40-year-olds. Why is the latter not an example of age discrimination, while the former is seized upon as an example of gender discrimination? Because men are too afraid to challenge the false statement.

If women truly did earn 20% less for doing exactly the same job as a man, any non-sexist CEO could thrash his competition by hiring only women, thus saving 20% on employee salaries relative to his competitors. Are we to believe that every major CEO and Board of Directors is so sexist as to forego billions of dollars of profit? Women entrepreneurs could hire other women and out-compete any male-dominated business, but we don't see this happening. Individual cases of discrimination may exist, but it cannot possibly be a universal norm in a profit-driven economy. Market forces would correct such mispricings, if they actually existed.


~The Futurist

14 Comments:

At 3/11/2009 6:19 PM, Blogger Milton Recht said...

A recent report supports the conclusion that there is not universal wage discrimination in the US between women and men.

A report prepared for the US Department of Labor, http://www.consad.com/content/reports/Gender%20Wage%20Gap%20Final%20Report.pdf, found that almost the entire wage gap disappears when wage difference analysis includes the value of benefits, breaks in working years and part-time work versus full time.

The report found that:

Much of the literature, including the Bureau of Labor Statistics Highlights of Women’s Earnings, focuses on wages rather than total compensation. Research indicates that women value non-wage benefits, such as health insurance, more than men do, and as a result prefer to take a greater portion of their compensation in the form of fringe benefits. The value of fringe benefits is not included in most studies of wage discrimination.

A greater percentage of women than men tend to leave the labor force for childbirth, childcare and elder care. The greater percentage of women who were not in the labor force during previous years explains part of the wage gap.

A greater percentage of women than men tend to work part-time. Part-time work tends to pay less than full-time work.

When wage adjustments include the above three items, about 80 percent of the difference in wages disappears. Inclusion of the items reduces the wage gap from 20 percent to about 4 percent.

 
At 3/12/2009 12:18 AM, Blogger OBloodyHell said...

I'd also direct anyone actually interested in The Truth, as opposed to justifications for outrage, towards:

Why Men Earn More: The Startling Truth Behind the Pay Gap -- and What Women Can Do About It
by Warren Farrell

A psychologist, Dr. Farrell is a former president of NOW in the tri-state area, and has become a leader in men's advocacy groups, after realizing the way Feminism more and more was distorting the message of egalitarianism at its heart. He now argues for viewing the problems and solutions from both sides of the Gender gap.

 
At 3/12/2009 3:07 AM, Blogger randian said...

One might also ask how, if women earn so much less, they can spend so much more? If the 10 or 20:1 ratio of floor space at the local mall dedicated to women over men is any indication, women have a hell of a lot more disposable income than men do.

 
At 3/12/2009 3:45 AM, Anonymous Anonymous said...

"if women earn so much less, they can spend so much more? "

Because women have a secret second source of income that is not reported :

Divorce court.

The combination of no fault divorce + alimony means the woman bears no financial risk for deciding that her dutiful husband does not excite her aging loins anymore.

Whether the divorce has technically taken place, or whether the woman is using the threat of divorce in order to subjugate the man, the end result is the same. The wife owns what the husband makes.

90% of divorces are caused by women, 70% of the time the woman files, and the other 20% of the time the woman cheats of the man, forcing the man to file in shock.

Only 10% of the time is the man filing on his own terms.

 
At 3/12/2009 5:25 AM, Anonymous DG said...

Women are indisputably more likely to have kids and take maternity leave. Isn't it logical that in the labour market, for want of a much more sensitive phrase, they'd "trade at a discount" for a given skill/attitude?

 
At 3/12/2009 6:59 AM, Blogger craig said...

"It is also true that 22-year-olds earn less, on average, than 40-year-olds. Why is the latter not an example of age discrimination?"

Gee, could it be that 22-year-olds lack the real world knowledge and experience that 40-year-olds have and therefore are paid less?

"If women truly did earn 20% less for doing exactly the same job as a man, any non-sexist CEO could thrash his competition by hiring only women, thus saving 20% on employee salaries relative to his competitors."

They can also hire a bunch of high-schoolers to run their company! That would save them even more money!

 
At 3/12/2009 7:15 AM, Anonymous Anonymous said...

There are good non-discriminatory reasons why women average less than men. But the reason given in this quote is irrelevant and a quick look at history will show it.

One simple example out of many possible: The US market paid blacks far less than whites up until 50 years ago. The market clearly did not correct that inequality for many decades.

The author is putting an ivory tower theory of how the market should work ahead of reality.

 
At 3/12/2009 7:44 AM, Blogger tommcmahon said...

From David Halberstam's October 1964:

"It was now seventeen years since Jackie Robinson had broken in with the Dodgers, and had done it so brilliantly that he had not only helped lead Brooklyn to a pennant but had also won the Rookie of the Year award. That there was a great new talent pool of black athletes was hardly a secret among the white players themselves. The names of such great black players as Josh Gibson, Satchel Paige, and Judy Johnson had been well known to the many big league players wh had often barnstormed with them after the regular season was over (and who often made more money barnstorming on the all-white major league all-star teams than their colleagues had made playing in the World Series): they knew that the Negro leagues were filled with players who could hit and pitch, and, above all, who had speed. In the years since Robinson's historic arrival in the big leagues, certain teams had moved quickly to sign up the best black players. It was the equivalent of a bargain-basement sale at Tiffany's -- great players available at discount prices, even as the price of young, untried white players was going up very quickly."

Yes, discrimination can last a long, long time. But the market is always pushing against it.

 
At 3/12/2009 8:58 AM, Blogger ExtremeHobo said...

The combination of no fault divorce + alimony means the woman bears no financial risk for deciding that her dutiful husband does not excite her aging loins anymore.

LOL

 
At 3/12/2009 11:27 AM, Blogger Peter Sean Bradley said...

Years ago, a client walked in with the preposterous story about how he had been fired because he was a man. His claim wa that he was the manager of a facility, that prior to the hiring of a new male CEO the company's 20 or so facilities had been divided 50/50 between men and women managers and that after the new CEO had been hired the male managers had been systematically fired and replaced by women.

It turned out that the historical data fit the story my client told, but the idea of a male discriminating against a male seemed anomalous.

In a deposition of one femle assistant to the CEO I got the answer. She testified that the CEO had told her that he preferred female managers because "they were cheaper and more docile than men."

 
At 3/14/2009 10:14 AM, Blogger OBloodyHell said...

"The U.S. Census Bureau found that as early as 1960, never-married women over 45 earned more in the workplace than never-married men over 45."
- Warren Farrell -

*1960*. That's before "Women's Lib"...

Also relevant --

A simple question: Women also control, by virtue of living longer than men, far more than 50% of the real wealth in this nation. Why don't these women choose to put far more female executives in charge?

 
At 3/14/2009 12:32 PM, Blogger randian said...

Women also control, by virtue of living longer than men, far more than 50% of the real wealth in this nation. Why don't these women choose to put far more female executives in charge?

Because there aren't many female executives. It's a lot easier to control wealth earned by somebody else than to earn it yourself.

 
At 6/15/2009 6:45 PM, Blogger msc said...

Women will tell you that it's different for us in the job market than it is for men. In my early 20's - during the early 1980's I remember facing blatant sexual harassment on the job. (The sort of nonsense nobody would ever attempt now.) During the dotcom boom, the GenXer's were over-valued, and many of them truly underproduced, yet business had a dismissive attitude toward women in their 40's. Yes - we have to curtail our careers for our children - for years - primarily because it's a duty that is never expected of men.

 
At 6/16/2009 11:25 PM, Blogger randian said...

Yes - we have to curtail our careers for our children - for years - primarily because it's a duty that is never expected of men.

I would have sympathy for that, were it not for the fact that women so jealously guard that duty and reserve it for themselves.

 

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