Male-Female Wage Gap?

Depending on which ‘study’ you read, some believe that there is a systematic difference in the amount of money companies pay men and women for the same work and they claim the difference is due to sexism. Let’s distill the issue of emotion and consider it rationally, reasonably, logically and with some common sense.

First of all, what does the phrase “for the same work” mean? Does it mean the same job title, working on the same types of projects, does it mean working in the same domain, what does it mean and how do you quantify it? If you read the ‘studies’ you’ll see there is no standard definition or measure of “for the same work”. It’s a purposefully vague and generalized concept that is typically whatever fits the author’s bias best. It doesn’t control for differences in education, industry, markets, geography, years of experience, market shares of the companies etc. The only metric is that – on average – men earn more per hour than women and it’s claimed that it’s “for the same work”.

In economics we talk about market value, wages, in terms of productivity and value to the firm. The more productive a worker is for the firm, the more valuable they are and the higher their wages. Productivity, then, seems like a reasonable basis for worker comparison.

So let’s restate the argument in the context of productivity: some believe that there is a systematic difference in the amount of money companies pay men and women for the same productivity and they claim the difference is due to sexism.

Now that we’ve clarified the problem, lets analyze it reasonably. Businesses exist to make a profit, in fact the people complaining about a wage gap are the same ones who complain that profits are the only thing businesses care about. If a man and a woman were significantly similar in their productivity in a given industry, and the companies paid the women less than the men due to their sexist attitudes, then those companies employing women would have a competitive advantage against other companies that paid higher wages to men. Labor costs are a huge part of any company’s bottom line and they are always looking for ways to cut them in order to increase profits. Being able to pay women less money for the same productivity would be the perfect solution.

So, if there really were a wage gap for the same productivity, we’d expect to see companies everywhere hiring more and more women, driving their wages up and simultaneously driving men’s wages down. We would also expect to see female owned businesses hiring all women since sexism wouldn’t be a factor but we don’t see that at all, and the reason is because productivity is not the same because men and women are not the same.

Social experiments have been conducted in which half an audience was male and half was female. The experimenter instructed the audience members to raise their hand when they heard a job called out that they’d be willing to do. The outcome is consistently the same: men and women are not willing to do the same jobs or work the same schedules. Men are more willing to work riskier jobs and longer hours at the expense of other things like family and personal time. Women are more likely to work more traditional jobs and fewer hours because they value their family and personal time. Another obvious difference is that women can get pregnant which will affect their productivity and their work schedule.

The sports industry gets a lot of attention because women athletes don’t understand why they don’t get paid as much as men. WNBA players don’t understand why they don’t get paid as much as NBA players. The product in professional sports is elite athleticism, athletes doing things that we can’t do and can’t see just anywhere like on a playground basketball court. The elite of the elite is what people pay for and women in the WNBA can’t compare to the men’s athleticism in the NBA so people choose to watch the NBA instead. We know that wages are a function of productivity so the players in the NBA are paid more because they bring in millions for their teams. WNBA players are paid less because they bring in very little. The WNBA brings in so little in fact that it has to be subsidized by the NBA to stay afloat.

There is no rational or empirical evidence to suggest wage differences has anything to do with sexism. It’s just an appeal to emotion to try to politicize the issue and get politics to force companies to pay women more money just because they’re women which I think is sexist.

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