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New Study Confirms ‘Gender Pay Gap’ Results From Women Making Different Choices – OpEd

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By Ryan McMaken*

In November, Harvard economists Valentin Bolotnyy and Natalia Emanuel published a new working paper titled “Why Do Women Earn Less Than Men? Evidence from Bus and Train Operators.”

In the study, Bolotnyy and Emanuel study unionized bus and train operators to determine whether or not a gender pay gap exists, and what its causes might be.

The use of unionized workers was helpful to the researchers because the rigid union rules meant that few pay decisions were left up to managers who might otherwise be blamed for bias in these cases.

As it is, the union rules provided clear rules for how seniority affects pay and setting of work hours.

This allowed the researchers to focus on the behavior of the workers themselves while largely ignoring the role of supervisor decisions.

The researchers did find that a gap existed:

The gap of $0.89 in oursetting, which is 60% of the earnings gap across the United States.

But, the gap

can be explained entirely by the fact that, while having the same choice sets in the workplace, women and men make different choices. Women use the Family Medical Leave Act (FMLA) to take more unpaid timeoff than men and they work fewer overtime hours at 1.5 times the wage rate. At the root of these different choices is the fact that women value time and flexibility more than men. Men and women choose to work similar hours of overtime when it is scheduled a quarter in advance,but men work nearly twice as many overtime hours than women when they are scheduled theday before. Using W-4 filings to ascertain marital status and the presence of dependents, we show that women with dependents – especially single women – value time away from work more than men with dependents.

More specifically:

the earnings gap can be explained in our setting by the fact that men take48% fewer unpaid hours off and work 83% more overtime hours per year than women. Thereason 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. 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. … When overtime hours are scheduled three months in advance, men sign up for about 7%more of them than women. When overtime is scheduled the day before or the day of thenecessary shift, men work almost twice as many of those hours as women.

Women with dependents – single women in particular – are considerably less likely than men with dependents to accept an overtime opportunity. This is especially the case during weekends and after regular work hours, times when there are fewer childcare options available.

These insights are helpful in seeing some specific of how men and women behave in the workplace. They also help to highlight the fact that even when men and women have the same job title and the same job description, the work they do is not homogenous. A worker who works at odd hours (and thus makes more overtime pay because of it) simply isn’t doing the same work as a person who requires extremely regular hours. Similarly, a worker who requires sizable chunks of time off every several years (for maternity leave or childcare needs) is also not doing the same work as a worker who rarely takes time off.

 If one of the workers is available nearly all the time, but the other one has a far more inflexible schedule, don’t have the same job when it comes to actual executions of duties.

Yet, we still continue to hear that “women are paid less to do the same work,” presumably because of gender bias. This latest study should help to expose, yet again, that this is an empirically untrue statement, and does not describe the nature of workplace behavior in the real world.

Moreover, this study found a pay gap in a single industry between workers doing similar work. How much more does the heterogeneity of work and workers explain an overall, nationwide “pay gap”? Nationwide, differences in work span across thousands of industries, jobs, and working conditions. The many differences in these cases are uncountable.

Leftists, of course, may see this data and argue that this shows women are still at a disadvantage because single women with children (which are more common than single men than children) are constrained in their choice of hours by childcare needs. Therefore, we need government policies to equalize this situation.

This is true, but only in the sense that, when it comes to earnings, people who work fewer hours are at a “disadvantage” compared to people who work longer hours. It is possible that policies forcing “equality” between people who can work longer, odder hours, and those who can’t, could help those who aren’t flexible. This, of course, would come at the expense of those who work odder hours right now.

But this is not at all a situation in which “women are paid less to do the same work.” And we should stop pretending that it is.

In fact, in a variety of settings, women earn more than men. As Andrew Syrios has noted:

When comparing never-married women with never married-men, the wage gap doesn’t just disappear, it flips. As far back as 1971, never-married women in their thirties have earned slightly more than similar men. 2 In 1982, never-married women on the whole earned 91 percent of what men do. 3 Today, among men and women living along from the age twenty-one to thirty-five, there is no wage gap.  And among unmarried college-educated men and women between forty and sixty-four, men earn an average of $40,000 a year and women earn an average of $47,000 a year! 5

And when all of this is taken into account, the wage gap all but disappears, as many studies have found:

  • A study by the CONSAD Research Corp. for the US Department of Labor found that once they controlled for the variables, there was “an adjusted gender wage gap that is between 4.8 percent and 7.1 percent.” 6
  • A study by June and Dave O’Neill for the National Bureau of Economic Research found that “… the gender gap largely stems from choices made by women and men concerning the amount of time and energy devoted to a career.”
  • Warren Farrell conducted a thorough study reported in his book Why Men Earn More and found no evidence of a wage gap.
  • A 1983 study by Walter E. Williams and the aforementioned 1981 study by Walter Block discredit the idea that the wage gap is caused by discrimination.
  • Carrie Lukas notes that “In a 2010 study of single, childless urban workers between the ages of 22 and 30, the research firm Reach Advisors found that women earned an average of 8% more than their male counterparts.”

*About the author:Ryan McMaken (@ryanmcmaken) is a senior editor at the Mises Institute. Send him your article submissions for Mises Wire and The Austrian, but read article guidelines first. Ryan has degrees in economics and political science from the University of Colorado, and was the economist for the Colorado Division of Housing from 2009 to 2014. He is the author of Commie Cowboys: The Bourgeoisie and the Nation-State in the Western Genre.

Source: This article was published by the MISES Institute

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The Mises Institute, founded in 1982, teaches the scholarship of Austrian economics, freedom, and peace. The liberal intellectual tradition of Ludwig von Mises (1881-1973) and Murray N. Rothbard (1926-1995) guides us. Accordingly, the Mises Institute seeks a profound and radical shift in the intellectual climate: away from statism and toward a private property order. The Mises Institute encourages critical historical research, and stands against political correctness.

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