10 ms·

Why Do Women Earn Less Than Men? Evidence from Bus and Train Operators [pdf]

44 points by wallace_f 8y ago

wallace_f 8y ago
Can someone explain to me what's wrong with this: If women make $0.70 for every $1.00 a man makes, and women are underrepresented in many lucrative fields, then: an arbitrage opportunity necessarily exists. In other words, if there is systemic sexism, then there exists a profit opportunity for entrepreneurs to buy-up typical companies and replace expensive, scarce male labor with cheaper, less-scarce female labor.
- throwaway5250 8y ago
  It's difficult to get someone to understand something when it's in their interest not to.
  - dang 8y ago
    Please don't post unsubstantive comments here. All the juice has been squeezed out of that cliché a long time ago.
    - throwaway5250 8y ago
      Apologies for my lack of originality.
- erikig 8y ago
  Labor is not easily fungible and is difficult to treat as a commodity.
  - claudiawerner 8y ago
    I disagree; the whole point of late capitalism has been to make labour more fungible than it was, to the point where it's actually very easy now. Labour-power, at least in the Marxian sense, is a commodity, but labour is not.
- koboll 8y ago
  I mean, you could have said the same about blacks in the decades between emancipation and the civil rights movement. Certainly, there were some people who took advantage of those arbitrage opportunities to some extent. But in the case of anti-black racism, it truly was a case of human prejudice outweighing market incentives, for a very long time.
  - wallace_f 8y ago
    In fact, when the dial was turned up all the way on prejudice and discrimination, slavery was the result, as an extreme version of this ability to arbitrage the pay gap. As insane and unjust as that was, that really existed. Today, if there is a pay gap it would be exploitable, no? Salaries are typically the by far the most expensive cost for most tech startups. Discrimination against women is illegal and socially shunned today. So what's stopping entrepreneurs from arbitraging this opportunity?
    - warp_factor 8y ago
      Because there is no such opportunity. This whole "0.70$ per 1.00$ from men", doesn't take into account different professions for example.
      - stcredzero 8y ago
        According to John Green, the actual gender pay gap is more like 8%. https://www.youtube.com/watch?v=it0EYBBl5LI https://www.youtube.com/watch?v=it0EYBBl5LI
  - stcredzero 8y ago
    I mean, you could have said the same about blacks in the decades between emancipation and the civil rights movement. I think Jesse Lee Peterson might have something to say with regards to that. I suspect that there were perceptive people who took advantage of societal conditions and hired industrious people for less money. But in the case of anti-black racism, it truly was a case of human prejudice outweighing market incentives, for a very long time. According to Thomas Sowell, with some kinds of work, some American slaves were paid additional bonuses for certain kinds of work requiring care and attention to detail. Otherwise, the proper level of motivation couldn't be maintained even through torture. Biases certainly can distort market forces, but the market forces will also bend society. Southern bus and train lines were opposing Jim Crow laws quite early on because they didn't want to spend money on extra vehicles/train cars.
- manicdee 8y ago
  Can you walk me through the acquisition process? I am getting lost at that point between “fire all the men” and “hire women with the appropriate experience.”
  - chcknsammich 8y ago
    Let's say you are a small startup owner, and you have enough cash on hand to hire 6 male devs. You then realize you could hire 7 equally competent female devs at the exact same price, all this while still offering more money than their supposed current employer who is underpaying them. If all of this were true the price would shift over time on these margins, and this "gap" would disappear. Why is it that we must constantly slice up society on demographic lines, point out a statistical in-congruency with some ideal (non-extant) world, and then claim some third party is culpable for causing this? If women were malevolently directed away from a field by educators, families, or traditions, why is it now an employer's responsibility to calculate said deficit in interest for a field and allocate resources sub-optimally in one direction or another for the sake of aligning statistics on some dubious spreadsheet? Don't tell women no, encourage them in what they want to do in life, and if in the end they don't choose the path that aligns with your macroeconomic utopia... get over it.
    - stcredzero 8y ago
      Let's say you are a small startup owner, and you have enough cash on hand to hire 6 male devs. You then realize you could hire 7 equally competent female devs at the exact same price In reality, the likely outcome is that the 7 women would end up working at Google, who can and will gladly way out-compete you on salaries, and you end up hiring 7 quirky men, then firing a few of them.
    - manicdee 8y ago
      Where do you find the 7 equally competent female devs, remembering that retention rate in the market is pretty low thanks to the salary gaps. The women look at the market and see they can get more money for other work, and there’s much less brogrammer culture to contend with, and leave the market.
- mattnewton 8y ago
  Wild speculation follows: So there could be two kinds of employers each competing in their own pool: one pool that believes gender (directly or indirectly) is a significant factor, and the other that does not think it is a significant factor to job performance. Because pool 1 believes that gender is not a significant factor, they know that wage discrimination on the basis of that factor would be illegal and open them up to lawsuits. Pool 2 does think gender is significant, maybe indirectly laundered through other things like personality assessments, and they therefore think they can and should act on that information. Critically it doesn’t matter if the sexist pool is openly sexist or using factors more strongly correlated with sex than job performance (like whether or not the employee looks the mental model of the part). The result is the same, they believe they are justified in paying women less. The arbitrage opportunity would never occur to them because they don’t think the labour is worth more. But if you see the arbitrage opportunity, that puts you in Pool 1 by definition. And so those who are aware of the opportunity know that it would be illegal since the gender isn’t relevant to their position.
  - BeeOnRope 8y ago
    The group 1 group, which wishes to hire more women to "exploit" this gap, doesn't have to engage in wage discrimination though, do they? They just have to hire at the "going rate" for women, which to the extent that a wage gap exists means they would be hiring mostly women. If they did hire any men, they just need to ensure they are paid the same as their existing workforce. So you don't need to engage in wage discrimination to hire women, since that is evaluated within a company, not in relation to a sector has a whole. That is, if McDonald's pays all their employees $10 an hour and they are mostly women, and Burger King pays all their employees $15 an hour for approximately the same work and they are mostly men, I don't think there is any (legal) claim for discrimination?
    - mattnewton 8y ago
      No, group 2 must be doing wage discrimination per the definition: they are paying women less solely because of their gender, that’s the only way the arbitrage works. If they set wages at $10/hr hoping to capture all the women turned away, they will also fail to capture male employees worth $15/hr. That puts them in the same pool as Burger King. There isn’t an arbitrage opportunity based on gender here. Assuming that Mcdonald’s and Burger King are the only employers, this also doesn’t get rid of the pricing gap. Women are paid less on average because they are turned away from the higher paying Burger King disproportionately. Burger King thinks what they are doing is not discrimination. Mcdonald’s must also think what they are doing is not discrimination, or they have a vast conspiracy to violate the law. They are both Group 2 companies.
- jldugger 8y ago
  This is the Greenspan argument. In his own words: > I always valued men and women equally, and I found that because others did not, good women economists were cheaper than men. Hiring women does two things: It gives us better-quality work for less money, and it raises the market value of women. But in order to arbitrage this, you have to be willing to pay women and men differently. It's not impossible to see a market where everyone internally values work equally, but believes the market does not, and thus all lower their offers made to women.
  - mattnewton 8y ago
    I think that hit the nail on the head: once you see the arbitrage opportunity, to exercise it you must knowingly discriminate against women, which is unethical and likely illegal.
    - euyyn 8y ago
      No, you really don't. The following isn't true: > But in order to arbitrage this, you have to be willing to pay women and men differently. A very simple way to arbitrage it without discriminating is to set your wages somewhere between what others pay men and women. Women will flock to you, as you pay better than elsewhere, while men will tend to leave to the discriminating jobs. You pay everyone the same, but the result is your cost in wages is lower than your competitors'.
      - mattnewton 8y ago
        So you are banking on there being enough women who leave discriminating employer in your field to fill all available positions. In that case there is just a lot of labour - I don’t see why employer 1 isn’t lowering their wages of new recruits anyways. Also, the discriminating employer is presumably not discriminating openly, or they will be sued. So there is limited information on your part to find the right pricing for just women. Wages are also sticky, it is hard in many industries to blanket cut them across the board without a real cost to morale and the quality of the labour you attract. In practice I cant imagine a real firm that could execute on this strategy.
- tbrownaw 8y ago
  The market is not efficient. Even if there really was a pay gap of that magnitude, it could still persist in the short run (compare to, "in the long run we are all dead"). The wonderful thing about high-prestige fields is that nobody really knows how to measure productivity. There's also the possibility of bias in school or training programs, which would lead to differences that the labor market is not responsible for because they exist earlier in the pipeline.
- viraptor 8y ago
  It's probably hard to replace people this way in existing companies. But the incentive is definitely there in many cases. There are for example companies staffed with mostly disabled people getting extra tax subsidy. But the biggest issue with that is: you basically wrote "if there is systemic sexism, there's profit in exploiting that". Why would anyone want to work for you in that case? You're not improving the situation, and benefit from it continuing - that's what's wrong with the idea.
- TheCoreh 8y ago
  I've thought about this too, because understanding why this doesn't seem to happen more often is part of figuring out how to address the underlying pay gap issue. My guess is that even assuming a perfectly rational employer (with no unconscious bias), the viability of this sort of arbitrage would depend on women _costing_ $0.70 to the dollar to their employers when compared to men, not on women _earning_ $0.70 to the dollar. I'm not at all knowledgeable about how this is usually handled in the US, but what I've heard from entrepreneurs in Brazil (where I live) is that despite the fact that maternity leave here is paid for by our social security system, it still ends up incurring in additional costs to the employer, mainly because they need to hire/train a temporary replacement. (Who will most likely be less effective/productive than the more experienced person who took the leave) Even if the law got updated to grant both genders the same parental leave time (or to allow a shared amount of months to be split by the parents in however way they prefer) it would still require a significant cultural shift to have men actually _choose_ to take the leave. (Anecdotal evidence: I've talked to several local male peers and most of them said they would not bother taking paternal leave even if available, and would rather stay at work) This sort of market/cost-driven decision making is obviously not good from a moral perspective, and is especially unfair with women that don't want or can't have children, or would rather have children but take a shorter or no leave. However, I also understand that a lot of businesses have very thin margins and fierce competitors, so taking the actuarial calculation approach to estimating how much an employee will 'cost' you might be something they perceive as their only take on surviving. I'm not sure on what is the best way to (re)align the incentives so that this doesn't happen anymore and the gap is closed for good. EDIT: what other commenters have pointed out also makes a lot of sense: exercising this sort of arbitrage in the first place would likely require the use of immoral and probably illegal discriminatory practices
  - stcredzero 8y ago
    (Anecdotal evidence: I've talked to several local male peers and most of them said they would not bother taking paternal leave even if available, and would rather stay at work) Anecdotal: I have a coworker campaigning to have the company let him take paternal leave.
- throwaway7312 8y ago
  My experience hiring women for our company has been 1.) they often don't want the job, 2.) when they get the job, they often balk at how demanding it is, then 3.) if they do stick around, regardless how much training we give them we end up having to let them go. This is not all female hires; we have women in customer service roles, for example, who outperformed our male hires; the females kept the job, the males did not. But for more technical roles, they have consistently either balked at the workload or underperformed and been quickly fired (we fire male workers who underperform just as quickly). I would love to hire female employees who are every bit as driven, thorough, methodical, and accountable as our best male employees (the ones we don't fire), who are also cheaper. But they do not seem to exist. The rare female prospective hires who are available and seem good are often priced so high I assume their rates are the result of Fortune 500 companies competing over them to have an effective female on the team. Good for them, but until effective females become cheaper than effective males it doesn't make sense for us to hire them from a value perspective (we don't need the social signaling points).
  - dragonsngoblins 8y ago
    What field is your company in? Given that this is HN and going off of a few things you said I am going to assume it is Tech, but I know that is still a pretty big assumption. However if it is Tech or some similarly male dominated field then of course competent women can charge more because they are more in demand. But that is in those specific fields and doesn't explain away the lack arbitrage opportunity from hiring women in general if they are indeed paid less in general.
- nearbuy 8y ago
  You seem to be ignoring the linked study, which found that female bus and train operators earned less because they took more time off and worked less overtime. Pay gaps due to reasons like these don't create arbitrage opportunities. You want people to work overtime when you ask for overtime. In general, the pay gap due to discrimination is much smaller than the total pay gap. It's also not universal: it varies by city and occupation. If you're evaluating two employees who seem about equally qualified and one asks for a 30% lower salary, it's easy to see the arbitrage opportunity. But if the employee is only asking 5% less? It's less obvious. You may have felt from the interview that the other candidate was 6% better overall. Then consider that discriminatory employers may not be evenly dispersed. In towns without much discrimination, there may be no arbitrage opportunity. In towns with heavy discrimination, there may not be enough non-discriminatory employers to hire all the undervalued workers.
- AnthonyMouse 8y ago
  > In other words, if there is systemic sexism, then there exists a profit opportunity for entrepreneurs to buy-up typical companies and replace expensive, scarce male labor with cheaper, less-scarce female labor. The trouble is that the difference starts earlier than that. Say you buy a tech company with 90% male software developers, aiming to balance it out. Turns out qualified female software developers get paid the same amount, but there aren't as many women with computer science degrees or relevant experience. You could go round up some lower-paid women with no qualifications and train them to be software developers, but you could also do the same thing with lower-paid individuals with no qualifications who are of any gender. The problem in both cases is that once they're qualified for the higher paid work, you have to pay the higher salary or they can quit and go work for someone who does.
dang 8y ago
Url changed from https://fee.org/articles/harvard-study-gender-pay-gap-explained-entirely-by-work-choices-of-men-and-women/ https://fee.org/articles/harvard-study-gender-pay-gap-explai..., which points to this.
- em-bee 8y ago
  why? that article provides a summary and is more interesting to read. not everyone wants to read an 80 page paper. i'd understand if the article didn't add any value at all, but i don't think that's the case here.
  - dang 8y ago
    That article is ideologically more tendentious, which would pretty well guarantee a flamewar in the thread. That and the site guideline favoring original sources (https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html) made it seem a clear call.
door5 8y ago
Men take more overtime, women do more domestic work, men are paid for overtime, women are not paid for domestic work. Is this not unjust?
- monochromatic 8y ago
  Seems pretty just. Who would be paying for the domestic work, anyway?
  - TaylorAlexander 8y ago
    One of the original complaints of feminism was that we had developed a culture where both men and women work all day long, but women’s work was unpaid domestic work while the men got the paycheck. That gave men huge power over women in a society that still relied on the women’s work. So we can identify a problem. The society (of the 1960’s and before in particular) required women’s work, but women were not compensated for their work. Given how critical that work is for society, it does strike me as a real problem. A secondary question is what to do about it, which I believe you are asking. That is much more complicated. We have identified a problem, but perhaps have not identified a solution. However the lack of a solution does not mean it is fair to ignore the problem. I bet feminists have suggested lots of solutions to this, but it’s telling that you and I (I expect) are both ignorant of them. However, I do think this expectation of necessary unpaid work is unfair. Can anyone comment on proposed solutions to this in the feminist literature? Thanks!
    - westiseast 8y ago
      I’m a stay at home dad and have been for the last 5 years. My wife works for herself, spending anywhere from 10-14 hours a day working pretty much 6-7 days a week (she loves her job and gets paid well to do it). Personally I don’t see it as an unfair bargain. I work hard at home, it can be stressful and tiring sometimes, but my wife takes on all the stress of providing income. I get ‘compensated’ pretty well - we have a good income and I live a great life. I personally think that home-makers who complain that they aren’t ‘compensated’ for their work are being churlish. That’s great when it’s working well. I suspect there’s a couple of problems - (1) often the home-maker goes back to work, but the home-duties don’t get redistributed accordingly. The home maker is forever saddled with that burden, limiting their career options. (2) In a divorce, the man is often left with a good income, through a valid, ongoing career, while the stay-at-home mom is left with an empty CV, the ongoing burden of the kids, and an allowance decided by the courts. Sure, men might have the burden of a new alimony/child payments ‘tax’, but otherwise they’re now free to do whatever they want. The woman isn’t. (vast generalization of course)
RcouF1uZ4gsC 8y ago
TLDR: > Mechanically, the earnings gap can be explained in our setting by the fact that men take 48% fewer unpaid hours off and work 83% more overtime hours per year than women. The reason for these differences is not that men and women face different choice sets in this job. Rather, it is that women have greater demand for workplace flexibility and lower demand for overtime work hours than men.
- fizwhiz 8y ago
  While that is a rather uncharitable reduction of the arguments made, I'm not sure why people are downvoting you.
- b1gtuna 8y ago
  So the gap here is entirely due to choices made directly by the employees?
- misterpigs 8y ago
  Headlines should reflect this finding but then that wouldn't garner as many views. It seems that this pay difference argument is often framed as something done maliciously or purposefully by the employer instead of neutral decisions made in response to decisions made by the employee. Naturally whomever is caring for children will want more flexibility at work and receive different pay to accommodate this, regardless of if that person is a man or a woman.
deleted 8y ago
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warp_factor 8y ago
The coverage on this subject is more and more made to follow a feminist/sexist narrative that wants to prove that the world is patriarchal and against womens. the common saying "0.70$ for every 1.00$ of a man" is when you average all the women salaries against all the man salaries. It doesn't take into account specific individuals or interests. I believe the main issue here is that womens are on average more interested in having a better quality of life (as shown with overtime in this paper), and are also less pushy during salary negotiations.
- abalone 8y ago
  The paper directly contradicts your beliefs about “womens”: > These gender differences are consistent with women taking on more of the household and childcare duties than men, limiting their work availability in the process (Parker et al., 2015; Bertrand et al., 2015).
  - warp_factor 8y ago
    how does that contradict any of my "beliefs" ? The workplace is not the one restricting the women to work more hours. It seems to be based on a choice and preference.
    - abalone 8y ago
      You didn’t limit it to the workplace. You said the pay gap is due to “interests” not a “patriarchal world against womens.” The study specifically mentions patriarchal gender roles as a primary factor behind those interests.
      - warp_factor 8y ago
        The gender roles as you describe them result from an individual choice from every man/women involved. Nobody forces a person today in the system to follow those gender roles. What I see in my circle of friends is that in most couples with kids, it is a conscious choice for the women to spend more time at home (and give up extra hour?) and for the man to spend more time at work. This is indeed a stereotype but there is nobody forcing anyone to follow those gender roles. We all know successful women/men going against those gender roles. If you take a conscious decision to work less hours to spend more time at home, you cannot be mad at "society" for patriarchism etc.
blakesterz 8y ago
Can we make any generalizations from this study? Especially to non-union, private sector jobs? This seems like a great study because it was very limited, but are the results limited as well?
hnaccy 8y ago
>Crucially, a gap in overtime acceptance rates barely exists for those who are married. As we can see in Figure 10, married male operators with dependents are only 0 to 2 percentage points more likely to accept overtime than married women with dependents. This suggests that those who are married with dependents, men and women, are able to divide up caretaking responsibilities at home in a way that allows them to work overtime at similar levels. The decline of two parent households and rise of single motherhood strikes again.
- BadassFractal 8y ago
  Reminds me of the (trite?) conservative talk points that if you 1. finish high school 2. don't have children outside of marriage 3. hold down a job, then you should more or less have a successful middle class existence.
  - stcredzero 8y ago
    1. finish high school 2. don't have children outside of marriage 3. hold down a job, then you should more or less have a successful middle class existence. What's wrong with that? I think that's a fine way to plan one's life. It's over simplifying some things. Not all high school educations are equally valuable, for one thing, which then also relates to point 3.
    - dabbledash 8y ago
      People who don’t start out committed to socially conservative ideas are suspicious about the direction of the causality.
      - stcredzero 8y ago
        I test center-left politically. However, I still think that education and stable family life is quite important for raising children to be successful. As for the direction of the causality, Chinese emigrants the world over have arrived on distant shores with very little money, often less that the general populace and often less even than the local poor. Yet they prospered, maintained a high regard for the value of education, then in subsequent generations have sent their children to good schools. This has been happening for many hundreds of years. The mother's side of my Cane River creole ex-girlfriend's family had values like this. I knew some very graceful people of African American descent who also had values like that. In my experience, it's such values, however they come about, which are the causal origin. I find your apparent preconceived notions on who gets to hold which ideas disturbing. Ideas are ideas, not flags or arm-bands.
stcredzero 8y ago
A female friend of mine who worked at Whole Foods did the typically male tactics cited in this article: Trading off regular hours for more lucrative Holiday and overtime hours. She also had a family. (And a 2nd job as a Yoga instructor. Not sure how that aligned her incentives.)
- abalone 8y ago
  Great, well I guess that one anecdote overrides a careful study by the Harvard department of Economics.
  - stcredzero 8y ago
    Of course it doesn't. I simply admire my friend for bucking the typical trend. (And boosting her income by doing so.)
    - abalone 8y ago
      This implies it is a choice on the part of the woman, when the study mentions it may very well be due to sexist gender roles regarding childcare. Hopefully you don’t congratulate successful minority friends for “bucking the typical trend.”
      - stcredzero 8y ago
        This implies it is a choice on the part of the woman Which is literally what my friend told me on the matter. She deliberately chose to work less convenient hours with longer shifts for a higher pay rate. Hopefully you don’t congratulate successful minority friends for “bucking the typical trend.” I would so congratulate Jeremy Lin for doing so. It seems as though you have a particular problematic preconceived notion of what a minority trend is. Just who are you imagining when you write, “bucking the typical trend?”
  - dang 8y ago
    Please follow the site guidelines, which ask: "Please respond to the strongest plausible interpretation of what someone says, not a weaker one that's easier to criticize. Assume good faith." https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html
belorn 8y ago
I wonder why studies like this never explore incentive models of why there are different choices. What does the data say about the subset of men who go against the gender norm and avoid inconvenient days, do not work overtime, prioritizing schedulerelated amenities, and take more unpaid time off. How does society treat that subset compared to the majority that follows gender norm? I would predict that their income would be lower, but not as much as the average woman. The risk of involuntarily childlessness would be significant higher and their social support network would on average be smaller. Health would be a interesting aspect to look at, which could honestly go either way. I would also predict that for the subset of women who would go against those gender expectation would look rather similar. Involuntarily childlessness would go up but far below that of the average man. Their social support network would also shrink but again not below that of men. In trade their income would be above average but not as much as the average man. Average health and life span would likely go down but not as low as the average man.
- 0db532a0 8y ago
  What data do you base these predictions on? Is there any relevant data in the paper?
  - wodenokoto 8y ago
    While the word "predict" does appear, it is not in the sense of a prediction made upon data, but rather, the parent asks for a hypothesis to be tested. Therefore; these predictions are not based on any data. They are based upon knowledge and assumptions of the world.
  - belorn 8y ago
    I base my predictions on the number of studies and lecture which explore different aspect of those issues, but what I would like to see is a study that address those directly in the context of wage differences between men and women. This paper could have done this since they have much of the data, but they didn't. If you just want some random sources, there is a government study here in Sweden that looks at involuntarily childlessness and there is a significant correlation with income and men. That was published just a few weeks ago. Dating sites have brought data and shown that both success and quantitative response is very strongly positively correlated with income for men. It is often mentioned when I read about social status, with the same old mentioning of correlation between income and men. People who look at divorce rate see a correlation when men lose their job and their wives filing, with a larger drop in social support for the men. The theme is quite common in many studies on the topic. From listening to social experimental studies, when people try to reverse expectations, you often see stereotypical results decreasing, but as is often found, it does not go down to zero. When it come to life span expectancy and health, a common theme is that women prioritize and spend more time with the health sector than men. A commonly cited reason that men do not go to the doctor is because it conflicts with work priorities. Thus by combining that result with this study, I would predict that if you look at the subset that defies gender expectations, then a larger percentile of that subgroup will go to the doctor than the majority. However I have seen similar health related studies say that especially psychologists treat men and women differently and perceive men as being healthier than they are, resulting in worse health care even for those men which do defy gender expectations. To add to the problems, lower social status and smaller social support network affects health significantly which is why I am not sure if prioritizing doctors over higher income is better or worse.
TheCoelacanth 8y ago
This data seems of limited applicability to most jobs considering that these operators would typically have very standardized pay scales, very standardized promotion tracks, very standardized job roles, very standardized performance evaluation criteria and so on which greatly limits the factors that can affect pay differences. Most jobs have much greater variability in all of those areas.
deleted 8y ago
[deleted]

44 points by wallace_f 8y ago

Can someone explain to me what's wrong with this: If women make $0.70 for every $1.00 a man makes, and women are underrepresented in many lucrative fields, then: an arbitrage opportunity necessarily exists. In other words, if there is systemic sexism, then there exists a profit opportunity for entrepreneurs to buy-up typical companies and replace expensive, scarce male labor with cheaper, less-scarce female labor.

throwaway5250 8y ago
It's difficult to get someone to understand something when it's in their interest not to.
- dang 8y ago
  Please don't post unsubstantive comments here. All the juice has been squeezed out of that cliché a long time ago.
  - throwaway5250 8y ago
    Apologies for my lack of originality.
erikig 8y ago
Labor is not easily fungible and is difficult to treat as a commodity.
- claudiawerner 8y ago
  I disagree; the whole point of late capitalism has been to make labour more fungible than it was, to the point where it's actually very easy now. Labour-power, at least in the Marxian sense, is a commodity, but labour is not.
koboll 8y ago
I mean, you could have said the same about blacks in the decades between emancipation and the civil rights movement. Certainly, there were some people who took advantage of those arbitrage opportunities to some extent. But in the case of anti-black racism, it truly was a case of human prejudice outweighing market incentives, for a very long time.
- wallace_f 8y ago
  In fact, when the dial was turned up all the way on prejudice and discrimination, slavery was the result, as an extreme version of this ability to arbitrage the pay gap. As insane and unjust as that was, that really existed. Today, if there is a pay gap it would be exploitable, no? Salaries are typically the by far the most expensive cost for most tech startups. Discrimination against women is illegal and socially shunned today. So what's stopping entrepreneurs from arbitraging this opportunity?
  - warp_factor 8y ago
    Because there is no such opportunity. This whole "0.70$ per 1.00$ from men", doesn't take into account different professions for example.
    - stcredzero 8y ago
      According to John Green, the actual gender pay gap is more like 8%. https://www.youtube.com/watch?v=it0EYBBl5LI https://www.youtube.com/watch?v=it0EYBBl5LI
- stcredzero 8y ago
  I mean, you could have said the same about blacks in the decades between emancipation and the civil rights movement. I think Jesse Lee Peterson might have something to say with regards to that. I suspect that there were perceptive people who took advantage of societal conditions and hired industrious people for less money. But in the case of anti-black racism, it truly was a case of human prejudice outweighing market incentives, for a very long time. According to Thomas Sowell, with some kinds of work, some American slaves were paid additional bonuses for certain kinds of work requiring care and attention to detail. Otherwise, the proper level of motivation couldn't be maintained even through torture. Biases certainly can distort market forces, but the market forces will also bend society. Southern bus and train lines were opposing Jim Crow laws quite early on because they didn't want to spend money on extra vehicles/train cars.
manicdee 8y ago
Can you walk me through the acquisition process? I am getting lost at that point between “fire all the men” and “hire women with the appropriate experience.”
- chcknsammich 8y ago
  Let's say you are a small startup owner, and you have enough cash on hand to hire 6 male devs. You then realize you could hire 7 equally competent female devs at the exact same price, all this while still offering more money than their supposed current employer who is underpaying them. If all of this were true the price would shift over time on these margins, and this "gap" would disappear. Why is it that we must constantly slice up society on demographic lines, point out a statistical in-congruency with some ideal (non-extant) world, and then claim some third party is culpable for causing this? If women were malevolently directed away from a field by educators, families, or traditions, why is it now an employer's responsibility to calculate said deficit in interest for a field and allocate resources sub-optimally in one direction or another for the sake of aligning statistics on some dubious spreadsheet? Don't tell women no, encourage them in what they want to do in life, and if in the end they don't choose the path that aligns with your macroeconomic utopia... get over it.
  - stcredzero 8y ago
    Let's say you are a small startup owner, and you have enough cash on hand to hire 6 male devs. You then realize you could hire 7 equally competent female devs at the exact same price In reality, the likely outcome is that the 7 women would end up working at Google, who can and will gladly way out-compete you on salaries, and you end up hiring 7 quirky men, then firing a few of them.
  - manicdee 8y ago
    Where do you find the 7 equally competent female devs, remembering that retention rate in the market is pretty low thanks to the salary gaps. The women look at the market and see they can get more money for other work, and there’s much less brogrammer culture to contend with, and leave the market.
mattnewton 8y ago
Wild speculation follows: So there could be two kinds of employers each competing in their own pool: one pool that believes gender (directly or indirectly) is a significant factor, and the other that does not think it is a significant factor to job performance. Because pool 1 believes that gender is not a significant factor, they know that wage discrimination on the basis of that factor would be illegal and open them up to lawsuits. Pool 2 does think gender is significant, maybe indirectly laundered through other things like personality assessments, and they therefore think they can and should act on that information. Critically it doesn’t matter if the sexist pool is openly sexist or using factors more strongly correlated with sex than job performance (like whether or not the employee looks the mental model of the part). The result is the same, they believe they are justified in paying women less. The arbitrage opportunity would never occur to them because they don’t think the labour is worth more. But if you see the arbitrage opportunity, that puts you in Pool 1 by definition. And so those who are aware of the opportunity know that it would be illegal since the gender isn’t relevant to their position.
- BeeOnRope 8y ago
  The group 1 group, which wishes to hire more women to "exploit" this gap, doesn't have to engage in wage discrimination though, do they? They just have to hire at the "going rate" for women, which to the extent that a wage gap exists means they would be hiring mostly women. If they did hire any men, they just need to ensure they are paid the same as their existing workforce. So you don't need to engage in wage discrimination to hire women, since that is evaluated within a company, not in relation to a sector has a whole. That is, if McDonald's pays all their employees $10 an hour and they are mostly women, and Burger King pays all their employees $15 an hour for approximately the same work and they are mostly men, I don't think there is any (legal) claim for discrimination?
  - mattnewton 8y ago
    No, group 2 must be doing wage discrimination per the definition: they are paying women less solely because of their gender, that’s the only way the arbitrage works. If they set wages at $10/hr hoping to capture all the women turned away, they will also fail to capture male employees worth $15/hr. That puts them in the same pool as Burger King. There isn’t an arbitrage opportunity based on gender here. Assuming that Mcdonald’s and Burger King are the only employers, this also doesn’t get rid of the pricing gap. Women are paid less on average because they are turned away from the higher paying Burger King disproportionately. Burger King thinks what they are doing is not discrimination. Mcdonald’s must also think what they are doing is not discrimination, or they have a vast conspiracy to violate the law. They are both Group 2 companies.
jldugger 8y ago
This is the Greenspan argument. In his own words: > I always valued men and women equally, and I found that because others did not, good women economists were cheaper than men. Hiring women does two things: It gives us better-quality work for less money, and it raises the market value of women. But in order to arbitrage this, you have to be willing to pay women and men differently. It's not impossible to see a market where everyone internally values work equally, but believes the market does not, and thus all lower their offers made to women.
- mattnewton 8y ago
  I think that hit the nail on the head: once you see the arbitrage opportunity, to exercise it you must knowingly discriminate against women, which is unethical and likely illegal.
  - euyyn 8y ago
    No, you really don't. The following isn't true: > But in order to arbitrage this, you have to be willing to pay women and men differently. A very simple way to arbitrage it without discriminating is to set your wages somewhere between what others pay men and women. Women will flock to you, as you pay better than elsewhere, while men will tend to leave to the discriminating jobs. You pay everyone the same, but the result is your cost in wages is lower than your competitors'.
    - mattnewton 8y ago
      So you are banking on there being enough women who leave discriminating employer in your field to fill all available positions. In that case there is just a lot of labour - I don’t see why employer 1 isn’t lowering their wages of new recruits anyways. Also, the discriminating employer is presumably not discriminating openly, or they will be sued. So there is limited information on your part to find the right pricing for just women. Wages are also sticky, it is hard in many industries to blanket cut them across the board without a real cost to morale and the quality of the labour you attract. In practice I cant imagine a real firm that could execute on this strategy.
tbrownaw 8y ago
The market is not efficient. Even if there really was a pay gap of that magnitude, it could still persist in the short run (compare to, "in the long run we are all dead"). The wonderful thing about high-prestige fields is that nobody really knows how to measure productivity. There's also the possibility of bias in school or training programs, which would lead to differences that the labor market is not responsible for because they exist earlier in the pipeline.
viraptor 8y ago
It's probably hard to replace people this way in existing companies. But the incentive is definitely there in many cases. There are for example companies staffed with mostly disabled people getting extra tax subsidy. But the biggest issue with that is: you basically wrote "if there is systemic sexism, there's profit in exploiting that". Why would anyone want to work for you in that case? You're not improving the situation, and benefit from it continuing - that's what's wrong with the idea.
TheCoreh 8y ago
I've thought about this too, because understanding why this doesn't seem to happen more often is part of figuring out how to address the underlying pay gap issue. My guess is that even assuming a perfectly rational employer (with no unconscious bias), the viability of this sort of arbitrage would depend on women _costing_ $0.70 to the dollar to their employers when compared to men, not on women _earning_ $0.70 to the dollar. I'm not at all knowledgeable about how this is usually handled in the US, but what I've heard from entrepreneurs in Brazil (where I live) is that despite the fact that maternity leave here is paid for by our social security system, it still ends up incurring in additional costs to the employer, mainly because they need to hire/train a temporary replacement. (Who will most likely be less effective/productive than the more experienced person who took the leave) Even if the law got updated to grant both genders the same parental leave time (or to allow a shared amount of months to be split by the parents in however way they prefer) it would still require a significant cultural shift to have men actually _choose_ to take the leave. (Anecdotal evidence: I've talked to several local male peers and most of them said they would not bother taking paternal leave even if available, and would rather stay at work) This sort of market/cost-driven decision making is obviously not good from a moral perspective, and is especially unfair with women that don't want or can't have children, or would rather have children but take a shorter or no leave. However, I also understand that a lot of businesses have very thin margins and fierce competitors, so taking the actuarial calculation approach to estimating how much an employee will 'cost' you might be something they perceive as their only take on surviving. I'm not sure on what is the best way to (re)align the incentives so that this doesn't happen anymore and the gap is closed for good. EDIT: what other commenters have pointed out also makes a lot of sense: exercising this sort of arbitrage in the first place would likely require the use of immoral and probably illegal discriminatory practices
- stcredzero 8y ago
  (Anecdotal evidence: I've talked to several local male peers and most of them said they would not bother taking paternal leave even if available, and would rather stay at work) Anecdotal: I have a coworker campaigning to have the company let him take paternal leave.
throwaway7312 8y ago
My experience hiring women for our company has been 1.) they often don't want the job, 2.) when they get the job, they often balk at how demanding it is, then 3.) if they do stick around, regardless how much training we give them we end up having to let them go. This is not all female hires; we have women in customer service roles, for example, who outperformed our male hires; the females kept the job, the males did not. But for more technical roles, they have consistently either balked at the workload or underperformed and been quickly fired (we fire male workers who underperform just as quickly). I would love to hire female employees who are every bit as driven, thorough, methodical, and accountable as our best male employees (the ones we don't fire), who are also cheaper. But they do not seem to exist. The rare female prospective hires who are available and seem good are often priced so high I assume their rates are the result of Fortune 500 companies competing over them to have an effective female on the team. Good for them, but until effective females become cheaper than effective males it doesn't make sense for us to hire them from a value perspective (we don't need the social signaling points).
- dragonsngoblins 8y ago
  What field is your company in? Given that this is HN and going off of a few things you said I am going to assume it is Tech, but I know that is still a pretty big assumption. However if it is Tech or some similarly male dominated field then of course competent women can charge more because they are more in demand. But that is in those specific fields and doesn't explain away the lack arbitrage opportunity from hiring women in general if they are indeed paid less in general.
nearbuy 8y ago
You seem to be ignoring the linked study, which found that female bus and train operators earned less because they took more time off and worked less overtime. Pay gaps due to reasons like these don't create arbitrage opportunities. You want people to work overtime when you ask for overtime. In general, the pay gap due to discrimination is much smaller than the total pay gap. It's also not universal: it varies by city and occupation. If you're evaluating two employees who seem about equally qualified and one asks for a 30% lower salary, it's easy to see the arbitrage opportunity. But if the employee is only asking 5% less? It's less obvious. You may have felt from the interview that the other candidate was 6% better overall. Then consider that discriminatory employers may not be evenly dispersed. In towns without much discrimination, there may be no arbitrage opportunity. In towns with heavy discrimination, there may not be enough non-discriminatory employers to hire all the undervalued workers.
AnthonyMouse 8y ago
> In other words, if there is systemic sexism, then there exists a profit opportunity for entrepreneurs to buy-up typical companies and replace expensive, scarce male labor with cheaper, less-scarce female labor. The trouble is that the difference starts earlier than that. Say you buy a tech company with 90% male software developers, aiming to balance it out. Turns out qualified female software developers get paid the same amount, but there aren't as many women with computer science degrees or relevant experience. You could go round up some lower-paid women with no qualifications and train them to be software developers, but you could also do the same thing with lower-paid individuals with no qualifications who are of any gender. The problem in both cases is that once they're qualified for the higher paid work, you have to pay the higher salary or they can quit and go work for someone who does.

dang 8y ago

Url changed from https://fee.org/articles/harvard-study-gender-pay-gap-explained-entirely-by-work-choices-of-men-and-women/ https://fee.org/articles/harvard-study-gender-pay-gap-explai..., which points to this.

em-bee 8y ago
why? that article provides a summary and is more interesting to read. not everyone wants to read an 80 page paper. i'd understand if the article didn't add any value at all, but i don't think that's the case here.
- dang 8y ago
  That article is ideologically more tendentious, which would pretty well guarantee a flamewar in the thread. That and the site guideline favoring original sources (https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html) made it seem a clear call.

door5 8y ago

Men take more overtime, women do more domestic work, men are paid for overtime, women are not paid for domestic work. Is this not unjust?

monochromatic 8y ago
Seems pretty just. Who would be paying for the domestic work, anyway?
- TaylorAlexander 8y ago
  One of the original complaints of feminism was that we had developed a culture where both men and women work all day long, but women’s work was unpaid domestic work while the men got the paycheck. That gave men huge power over women in a society that still relied on the women’s work. So we can identify a problem. The society (of the 1960’s and before in particular) required women’s work, but women were not compensated for their work. Given how critical that work is for society, it does strike me as a real problem. A secondary question is what to do about it, which I believe you are asking. That is much more complicated. We have identified a problem, but perhaps have not identified a solution. However the lack of a solution does not mean it is fair to ignore the problem. I bet feminists have suggested lots of solutions to this, but it’s telling that you and I (I expect) are both ignorant of them. However, I do think this expectation of necessary unpaid work is unfair. Can anyone comment on proposed solutions to this in the feminist literature? Thanks!
  - westiseast 8y ago
    I’m a stay at home dad and have been for the last 5 years. My wife works for herself, spending anywhere from 10-14 hours a day working pretty much 6-7 days a week (she loves her job and gets paid well to do it). Personally I don’t see it as an unfair bargain. I work hard at home, it can be stressful and tiring sometimes, but my wife takes on all the stress of providing income. I get ‘compensated’ pretty well - we have a good income and I live a great life. I personally think that home-makers who complain that they aren’t ‘compensated’ for their work are being churlish. That’s great when it’s working well. I suspect there’s a couple of problems - (1) often the home-maker goes back to work, but the home-duties don’t get redistributed accordingly. The home maker is forever saddled with that burden, limiting their career options. (2) In a divorce, the man is often left with a good income, through a valid, ongoing career, while the stay-at-home mom is left with an empty CV, the ongoing burden of the kids, and an allowance decided by the courts. Sure, men might have the burden of a new alimony/child payments ‘tax’, but otherwise they’re now free to do whatever they want. The woman isn’t. (vast generalization of course)

RcouF1uZ4gsC 8y ago

TLDR: > Mechanically, the earnings gap can be explained in our setting by the fact that men take 48% fewer unpaid hours off and work 83% more overtime hours per year than women. The reason for these differences is not that men and women face different choice sets in this job. Rather, it is that women have greater demand for workplace flexibility and lower demand for overtime work hours than men.

fizwhiz 8y ago
While that is a rather uncharitable reduction of the arguments made, I'm not sure why people are downvoting you.
b1gtuna 8y ago
So the gap here is entirely due to choices made directly by the employees?
misterpigs 8y ago
Headlines should reflect this finding but then that wouldn't garner as many views. It seems that this pay difference argument is often framed as something done maliciously or purposefully by the employer instead of neutral decisions made in response to decisions made by the employee. Naturally whomever is caring for children will want more flexibility at work and receive different pay to accommodate this, regardless of if that person is a man or a woman.

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warp_factor 8y ago

The coverage on this subject is more and more made to follow a feminist/sexist narrative that wants to prove that the world is patriarchal and against womens. the common saying "0.70$ for every 1.00$ of a man" is when you average all the women salaries against all the man salaries. It doesn't take into account specific individuals or interests. I believe the main issue here is that womens are on average more interested in having a better quality of life (as shown with overtime in this paper), and are also less pushy during salary negotiations.

abalone 8y ago
The paper directly contradicts your beliefs about “womens”: > These gender differences are consistent with women taking on more of the household and childcare duties than men, limiting their work availability in the process (Parker et al., 2015; Bertrand et al., 2015).
- warp_factor 8y ago
  how does that contradict any of my "beliefs" ? The workplace is not the one restricting the women to work more hours. It seems to be based on a choice and preference.
  - abalone 8y ago
    You didn’t limit it to the workplace. You said the pay gap is due to “interests” not a “patriarchal world against womens.” The study specifically mentions patriarchal gender roles as a primary factor behind those interests.
    - warp_factor 8y ago
      The gender roles as you describe them result from an individual choice from every man/women involved. Nobody forces a person today in the system to follow those gender roles. What I see in my circle of friends is that in most couples with kids, it is a conscious choice for the women to spend more time at home (and give up extra hour?) and for the man to spend more time at work. This is indeed a stereotype but there is nobody forcing anyone to follow those gender roles. We all know successful women/men going against those gender roles. If you take a conscious decision to work less hours to spend more time at home, you cannot be mad at "society" for patriarchism etc.

blakesterz 8y ago

Can we make any generalizations from this study? Especially to non-union, private sector jobs? This seems like a great study because it was very limited, but are the results limited as well?

hnaccy 8y ago

>Crucially, a gap in overtime acceptance rates barely exists for those who are married. As we can see in Figure 10, married male operators with dependents are only 0 to 2 percentage points more likely to accept overtime than married women with dependents. This suggests that those who are married with dependents, men and women, are able to divide up caretaking responsibilities at home in a way that allows them to work overtime at similar levels. The decline of two parent households and rise of single motherhood strikes again.

BadassFractal 8y ago
Reminds me of the (trite?) conservative talk points that if you 1. finish high school 2. don't have children outside of marriage 3. hold down a job, then you should more or less have a successful middle class existence.
- stcredzero 8y ago
  1. finish high school 2. don't have children outside of marriage 3. hold down a job, then you should more or less have a successful middle class existence. What's wrong with that? I think that's a fine way to plan one's life. It's over simplifying some things. Not all high school educations are equally valuable, for one thing, which then also relates to point 3.
  - dabbledash 8y ago
    People who don’t start out committed to socially conservative ideas are suspicious about the direction of the causality.
    - stcredzero 8y ago
      I test center-left politically. However, I still think that education and stable family life is quite important for raising children to be successful. As for the direction of the causality, Chinese emigrants the world over have arrived on distant shores with very little money, often less that the general populace and often less even than the local poor. Yet they prospered, maintained a high regard for the value of education, then in subsequent generations have sent their children to good schools. This has been happening for many hundreds of years. The mother's side of my Cane River creole ex-girlfriend's family had values like this. I knew some very graceful people of African American descent who also had values like that. In my experience, it's such values, however they come about, which are the causal origin. I find your apparent preconceived notions on who gets to hold which ideas disturbing. Ideas are ideas, not flags or arm-bands.

stcredzero 8y ago

A female friend of mine who worked at Whole Foods did the typically male tactics cited in this article: Trading off regular hours for more lucrative Holiday and overtime hours. She also had a family. (And a 2nd job as a Yoga instructor. Not sure how that aligned her incentives.)

abalone 8y ago
Great, well I guess that one anecdote overrides a careful study by the Harvard department of Economics.
- stcredzero 8y ago
  Of course it doesn't. I simply admire my friend for bucking the typical trend. (And boosting her income by doing so.)
  - abalone 8y ago
    This implies it is a choice on the part of the woman, when the study mentions it may very well be due to sexist gender roles regarding childcare. Hopefully you don’t congratulate successful minority friends for “bucking the typical trend.”
    - stcredzero 8y ago
      This implies it is a choice on the part of the woman Which is literally what my friend told me on the matter. She deliberately chose to work less convenient hours with longer shifts for a higher pay rate. Hopefully you don’t congratulate successful minority friends for “bucking the typical trend.” I would so congratulate Jeremy Lin for doing so. It seems as though you have a particular problematic preconceived notion of what a minority trend is. Just who are you imagining when you write, “bucking the typical trend?”
- dang 8y ago
  Please follow the site guidelines, which ask: "Please respond to the strongest plausible interpretation of what someone says, not a weaker one that's easier to criticize. Assume good faith." https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html

belorn 8y ago

I wonder why studies like this never explore incentive models of why there are different choices. What does the data say about the subset of men who go against the gender norm and avoid inconvenient days, do not work overtime, prioritizing schedulerelated amenities, and take more unpaid time off. How does society treat that subset compared to the majority that follows gender norm? I would predict that their income would be lower, but not as much as the average woman. The risk of involuntarily childlessness would be significant higher and their social support network would on average be smaller. Health would be a interesting aspect to look at, which could honestly go either way. I would also predict that for the subset of women who would go against those gender expectation would look rather similar. Involuntarily childlessness would go up but far below that of the average man. Their social support network would also shrink but again not below that of men. In trade their income would be above average but not as much as the average man. Average health and life span would likely go down but not as low as the average man.

0db532a0 8y ago
What data do you base these predictions on? Is there any relevant data in the paper?
- wodenokoto 8y ago
  While the word "predict" does appear, it is not in the sense of a prediction made upon data, but rather, the parent asks for a hypothesis to be tested. Therefore; these predictions are not based on any data. They are based upon knowledge and assumptions of the world.
- belorn 8y ago
  I base my predictions on the number of studies and lecture which explore different aspect of those issues, but what I would like to see is a study that address those directly in the context of wage differences between men and women. This paper could have done this since they have much of the data, but they didn't. If you just want some random sources, there is a government study here in Sweden that looks at involuntarily childlessness and there is a significant correlation with income and men. That was published just a few weeks ago. Dating sites have brought data and shown that both success and quantitative response is very strongly positively correlated with income for men. It is often mentioned when I read about social status, with the same old mentioning of correlation between income and men. People who look at divorce rate see a correlation when men lose their job and their wives filing, with a larger drop in social support for the men. The theme is quite common in many studies on the topic. From listening to social experimental studies, when people try to reverse expectations, you often see stereotypical results decreasing, but as is often found, it does not go down to zero. When it come to life span expectancy and health, a common theme is that women prioritize and spend more time with the health sector than men. A commonly cited reason that men do not go to the doctor is because it conflicts with work priorities. Thus by combining that result with this study, I would predict that if you look at the subset that defies gender expectations, then a larger percentile of that subgroup will go to the doctor than the majority. However I have seen similar health related studies say that especially psychologists treat men and women differently and perceive men as being healthier than they are, resulting in worse health care even for those men which do defy gender expectations. To add to the problems, lower social status and smaller social support network affects health significantly which is why I am not sure if prioritizing doctors over higher income is better or worse.

TheCoelacanth 8y ago

This data seems of limited applicability to most jobs considering that these operators would typically have very standardized pay scales, very standardized promotion tracks, very standardized job roles, very standardized performance evaluation criteria and so on which greatly limits the factors that can affect pay differences. Most jobs have much greater variability in all of those areas.

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