A Theory of Gender Discrimination Based on the Household

Source: RePEc

ABSTRACT This paper presents a new theory of gender discrimination in competitive labour markets which does not rely on any inherent gender asymmetries. Women and men are organized into households with each having identical household specific human capital. When labour market characteristics (effort, wages) differ, the possibility of mutually beneficial within household trades arises. Discrimination involves occupational segregation with men obtaining high paying efficiency wage jobs and women in piece rate work. It is shown that there always exists a Nash equilibrium in which firms benefit from discrimination by allocating high paying jobs exclusively to men, provided other firms also do so, as this ensures their employees (men) enjoy the benefits of within household trade and will satisfy incentive compatibility at a lower wage. A firm attempting to hire women in efficiency wage jobs makes strictly lower expected profits, since the predominance of men in the labour market means women are less likely to enjoy the benefits of within household trade and more likely to shirk. The model thus provides an intuitive explanation for discrimination in competitive labour markets even when the sexes are completely identical. It also suggests a positive role for affirmative action policies in moving the economy from the discrimination to a non-discrimination equilibrium.

  • [Show abstract] [Hide abstract]
    ABSTRACT: Purpose – The purpose of this paper is to investigate gender based wage differences by schooling and occupations and to estimate the occupational gender wage discrimination in Turkey where strenuous attempts are underway to modernize and negotiate its culturally (Islamic)-based gender differences. Design/methodology/approach – This study employs an extension of Blinder and Oaxaca's approach to measure the effect of wage discrimination. In order to correct a possible sample selection problem, Heckman's two step procedure is used to estimate the earning equations for males and females by using Turkish Household Expenditure and Income Survey. Findings – Among the paper's central findings is that gender wage gap decreases with education, is less in the public sector, and varies across occupations. The overall discriminatory wage gap is estimated at 30 percent after controlling for education, experience, occupation, region, and selection effects. Research limitations/implications – Limitations of this study are mostly related to the nature of the data set used in the analysis. Future research should be replicated on time series data with more variables if they are available. Practical implications – Policy makers should promote education of women since education reduces inequalities among genders as revealed from the decreasing gap of wage differentials for higher levels of education. They should implement measures aimed at reducing inequalities in women's pay and improving women's status in the labor market in line with the European Union policies. Originality/value – By using micro data, this study estimates the gender wage discrimination at occupational levels in Turkey by correcting the possible sample selection bias in the analysis, usually omitted in other studies.
    Journal of Economic Studies 01/2006; 33(May):130-143.
  • Source
    [Show abstract] [Hide abstract]
    ABSTRACT: A coordination model characterized by heterogeneity and non-random matching is developed. Het-erogeneity among individuals comes solely from their innate aptitude to perform one of the two tasks available. Potential spouses choose first the level of investment in each of the two types of human capital, and subsequently, engage in the search for a marriage partner. Premarital investments and aptitudes determine an individual's ability in the accomplishment of both tasks and hence, her desirability on the marriage market. In this environment, and under certain restrictions on the parameters, we show that gender segregations can be supported as decentralized equilibria in a society which treats the sexes equally. Furthermore, we claim that the sex ratio together with the extent of the market constitute crucial factors in the determination of both existence and efficiency of the sexual division of labor. In small or intermediate marriage markets, characterized by a high risk associated to mismatches in the population, the sexual division of labor can help coordinate people efficiently in the choice of premarital investments by relying exclusively on gender considerations. The sexual division of labor in which the gender who is scarce in the society specializes in the most productive task is efficient only if the sex ratio is sufficiently high. Otherwise, the alternative sexual division of labor emerges as the efficient rule. When the marriage market is large, the risk associated to mismatches vanishes and the training-according-to-sex is Pareto dominated.
  • Source
    [Show abstract] [Hide abstract]
    ABSTRACT: Individual and household based aggregate measures of worklessness can, and do, offer conflicting signalsabout labour market performance. We outline a means of quantifying the extent of any disparity,(polarisation), in the signals stemming from individual and household-based measures of worklessness andapply this index to data from 5 countries over 25 years. Built around a comparison of the actual householdworkless rate with that which would occur if employment were randomly distributed over householdoccupants, we show that in all the countries we examine, there has been a growing disparity between theindividual and household based workless measures. The polarisation count can be decomposed to identifywhich household groups are exposed to workless concentrations and can also be used to test whichindividual characteristics account for any excess worklessness among these household groups. We showthat the incidence and magnitude of polarisation varies widely across countries, but that in all countriespolarisation has increased. For each country most of the discrepancies between the individual andhousehold workless counts stem from within-household factors, rather than from changing householdcomposition.
    Journal of Population Economics 06/2004; 23(1):139-167. · 0.92 Impact Factor