Sub: Economics Topic: Gender Economy
The Homework solutions from Classof1 are intended to help students understand the approach to solving the problem and not forsubmitting the same in lieu of their academic submissions for grades.
The Gender Pay Gap
Why do women, on average, earn less than men? In the United States in 2008, the typical womanearned about 80 percent as much as the typical man. A recent study explored several factors thatcontribute to the gender pay gap. The study observed a gap of about 20 percent among workers aged26 to 34, and identified four factors that contribute to the gender gap:
Difference in worker skills and productivity.
On average, women have less education andwork experience, so they are less productive and thus receive lower wages. An importantfactor in the lower level of work experience among women is that many women interrupt theircareers to raise children. The study concluded that lower productivity is the most importantfactor in the gender gap.
Differences in occupational preferences.
Wages vary across occupations: Clerical and serviceoccupations receive lower wages than craft and professional occupations. Compared to men,women express stronger preferences for low wage occupations, such as clerical and serviceoccupations, and weaker preferences for some high-wage occupations, such as craft andoperator occupations. In contrast, men have slightly stronger preferences for high-wageprofessional and technical occupations. On balance, the general orientation of women towardlow-wage occupations contributes to the gender gap.
Given the variation in wages across occupations, if employershave a bias against hiring women for high-paying occupations, women will receive lowerwages. The study shows that on average, women are less successful than men in attainingtheir desired occupations, and this occupational discrimination by employers explains between7 and 25 percent of the gender gap.