Saturday, September 13, 2014

Gender Gap: Wages

Debates over the supposed differences between men and women are a staple of pop culture. But two new books offer an economic look at the evidence, giving support to both pessimistic and optimistic perspectives on the direction of gender relations and the prospects for more fairness and equality.
The first book, “Why Gender Matters in Economics” (Princeton University Press, 2014) by Mukesh Eswaran, an economics professor at the University of British Columbia, draws on data from past economic studies conducted under laboratory conditions to show how gender influences financial actions and relationships.
In one set of these experiments, called the dictator game, women were found to be more generous than men. Players were given $10 and allowed but not required to hand out some of it to a hidden and anonymous partner.Women, on average, gave away $1.61 of the $10, whereas men gave away only 82 cents.
In another test, called the ultimatum game, one player received $10 and then decided how much of it to offer to a partner. (Let’s say the first player suggests, “$8 for me, $2 for you.” If the respondent accepts the offer, that’s what each gets. If the respondent is offended by the unequal division or dislikes it for any other reason, he or she may refuse, and then no one gets anything.)
Photo
CreditMinh Uong/The New York Times
The depressing news was this: Both men and women made lower offers, on average, when the responder was female. Male proposers offered an average of $4.73 to male respondents, but only $4.43 to women. More painful yet was the behavior of female proposers, who, on average, offered $5.13 to men but only $4.31 to women. It seems that women were seen as softies who were willing to settle for less — and the discrimination was worse coming from the women themselves.
Another economic test involved a game in which players would fare best collectively if they cooperated, and yet individuals had an incentive to act more opportunistically for a higher payoff. The laboratory result was that women were more likely to start off by cooperating, but then would learn through bitter experience that they’d be taken advantage of if they continued to do so. By the time this game was played over multiple rounds, the initially cooperative behavior of the women converged into the more opportunistic behavior of the men, but women’s initial reluctance to use cutthroat strategies still brought them losses.
In another setting, women seemed quite willing to compete against other women but much less willing to compete against men. And in yet another study, women negotiated harder when they were working on behalf of others rather than for themselves, which implied a reluctance to push their own interests.
In sum, these research results suggest that women are perceived as easier to take advantage of in a variety of economic settings. That’s the bad news, and it comes from measuring a difference in gender behavior at a specific point in time.
There is greater cause for optimism, however, when we study changes over time. We find the more positive evidence in another new book, “The Silent Sex: Gender, Deliberation and Institutions” (Princeton University Press, 2014) by Christopher F. Karpowitz, professor of political science at Brigham Young University, and Tali Mendelberg, professor of politics at Princeton.
Drawing upon data from politics, business meetings and behavior in the corporate boardroom, they portray a society where women participate less in many public settings, especially those in which real power is exercised. This links up with the experimental results described in Mr. Eswaran’s book, because an underparticipating group that doesn’t resist discrimination is more likely to suffer.
This sounds gloomy so far. But the authors show that once women achieve a critical mass in a particular area, their participation grows rapidly, at least after basic norms of inclusion have been established.
In fact, the general method of economics provides foundations for some feminist views. First, economics emphasizes that incentives matter and that incentives can be changed. These are common themes underlying feminist thought, which stresses how a fairer social environment can give people greater reason to choose better behavior.
Second, the long-term response to a change in incentives is often much greater and more important than the short-term response. For instance, Mr. Karpowitz and Ms. Mendelberg show that, over time, men behave in a less stereotypically male way when more women are participating in an organization or an activity.

As a former chess player, I am struck by the growing achievements of women in this great game — one in which men were once said to have an overwhelming intrinsic advantage. (Among the unproven contentions was that men were better at pattern recognition.) Although women were never barred from touching the chess pieces, strong female players were few in number.
These days, many more women play very well, and the gap between the top men and women in the game is narrowing. The main driver of the changeappears to be that more and more women are playing chess, creating a cycle of positive reinforcement that encourages ever more women to excel. We’ve seen a similar dynamic in the workplace, as more women have made great strides in the areas of law, medicine and academia. And this process may spread to other sectors of the economy as well, such as technology industries.
This longer-term, optimistic perspective has deep roots in economics, and was articulated eloquently in “The Subjection of Women,” John Stuart Mill’s 19th-century essay. Mill said men and women were indeed different, but he saw the achievements of women as dependent on incentives and the work environment, which he thought could be improved beyond what most people in his day — and perhaps ours, too — could easily imagine. For all the sexist behavior we economists measure in the lab, the research around the bigger picture is supporting Mill’s optimism about a better world to come.

13 comments:

Anonymous said...

Historically, we as a society have attached some almost instinctual pre conceived notions to women. Now, as we know, times have changed. Women have come from the bottom of prejudice to the level of equality. As we can see from the article though, those age-old stigmas are still conscious and active in our society. It shows us that we still have room for progression in this area. What is even more interesting in this article is the portrayal of some level of timid behavior in the experiments on the woman’s part. It is a prime example of just how effective the notion of these historical stereotypes is at dictating behavior. On the part of both males and females.
-Austen

Phontayne Walker said...

As a woman, I felt great discomfort reading about this study. However, I do find its results to be interesting. Historically, women have always received much less for their work in comparison to their male counterparts within the same field/office. (Unfortunately, this is a matter that although their have been acts/laws passed to prevent this, can still be found in our current day society.) I believe that this could be a major reason as to why the women who participated in this study responded in the manner that they did. The ultimatum game, for example, helps to exercise this point. It makes sense that a woman would offer less to another female if they felt inferior to them or viewed them as competition (similar to when women first entered the workforce during the war and depression). Also, making less than a man, historically, can cause a woman to believe that a man should earn/take more of the allotted $10.
In the first study, however, I feel that the woman's overall maternal/caring quality is what made them giveaway almost double to the men that participated in this study.

Lauren Ronge said...

Throughout history women have always been thought of as less. This article basically talks about studies that encapsulate why women are though of the way they are.
In the dictator game, women always gave more money than the male. This shows that women want to please others and not themselves.
The ultimatum game basically portrayed women as "softies" and "settling".
I think the reason women are this way and are seen this way is because of their nature. They are suppose to be the caregivers and take care of the family. This is why they are so caring and are "soft".
I agree with Phontayne. I think that it was extremely unsettling to read this article. We all know that men tend to be more successful in the work place because women have a hard time reaching the top. The workplace has always been male dominated. But it was better to find out at the end that the gap between men and women in the workplace is narrowing.

Bobby Romeu said...

After reading this post i was quite stunned to read that women were more likely to be taken advantage when in a economic settings. Although media has portrayed women as being "inferior" towards men in many fields, but this study is one example of thats not the case. even though society stereotyped men being the top dog and the bread winner, women has proven time and time again that they step up and take roles that men normally have the position to.

Unknown said...

I was surprised by the results of both experiments mentioned in this article. Naturally I have often heard of women being taken advantage of in certain economic situations (for example when trying to purchase a car) but I did not realize that there were significant differences between the generosity of men and women when it came down to it. I assumed that women would try just as hard as men to push past the competition and reach for the top. Although we live in a world historically dominated by the patriarchy I believed we were more rapidly approaching a world where women were equal to men.

-Annemarie Casale

Dan Macko said...

It is a little disturbing seeing how much gender plays a role in how you handle your money. The first author really gets into how people are more generous towards men and how men save their money for themselves. Normally I would argue that women are just as sensible as men to stop falling for financial gimmicks, but after seeing the study where women get ripped off linger than men, it is hard to make a solid argument. Clearly the second author has different thoughts about this subject. He says that the gap between the top man and top woman is becoming more narrow. I would not come to a conclusion that in general men are better financially than women since there are some women who are better off than men. At best I would call this a stereotype and nothing more in reality.

Anonymous said...

It does not surprise me that in all of these studies, women tended to not stick up to their own case, even though they still knew they were getting the short end of the stick. When a women is alone with a man, the women tends to be a little intimidated, when it comes to sticking up for her own opinion. This could be that a man usually tends to think his opinion is fact, and therefore shows that he is superior to women, which of course is not the case. This all tends to change when there are multiple people in the room. When there are multiple men in a room with less women, the mens confidence are increased even further. On the other hand, when there are more women in the room, they have more confidence with their opinions. This means that if more and more women start to work in a field that commonly have men, women will feel more comfortable in that workplace, and in time, become just as productive in that field as men are.

-Jack Madden

Samantha Heslin said...

In the past women have been thought of as unequals to men, especially in the work place. I was actually quite surprised when reading this article that the stereotype of women being "less" was reinforced. Women were more generous than men in the studies which did not surprise me, but what did is that they even gave other women less money than they gave to men in the study. I was, however, pleased to see that the gap between women and men in the workplace is still becoming less and less over time.

Daniela Nardone said...

both results were quite surprising although I found it interesting how women were seen as an equal in this manner. Usually the stereotype is that women are less sensible when it comes to money and how they spend it. And with that said the work place has always been a tough spot for women. Still to this day men dominate in the work place and yes over time that has changed but the mentality will more or less be the same as it was.

Jahari Yates said...

The information that I read in the post was not really surprising to me. What I found interesting was the experiment between men and women regarding the $10. Even women don't treat women fairly, which is sad. Another thing that stuck with me was that women are often taken advantage of. As a male it bothers me that women sometimes have to work harder just to prove themselves. The second article gave hope that we are reaching a silver lining and that things we get better for women.

Gavin Maher said...

These studies and article do not surprise me at all. Women being "inferior" in the work place has always been a popular topic, and unfortunately there has not been a drastic change in the economy for women. It's clear that women have more opportunities than ever before, but it's also clear women are still perceived as being "inferior" instead of being equal. It takes time for society to change the view of stereotypes. ABC News broadcasted a segment in 2013 explaining the change of family breadwinners in America. Primary wage earners in forty percent of U.S. households are women. This is a stepping stone towards change for women in our economy today.

Brian B said...

I find the $10 game between men and women very eye opening. It's due to social pressures and norms that people offer less money to women, not because they work/preform less then men. Historically women have accepted less wages then men. This notion is unfortunately spilling into modern times. I do not blame the business or organization for paying women less, but rather the women who blindly accepts a lower wage. Setting a lower bar for themselves has unfortunately become the economic norm, and businesses want to keep it up. These businesses aren't sexist, they just take advantage of the social acceptance in order to maximize profit. If the genders were reversed, the exact same situation would happen. This isn't a gender issue, it's a social issue.

Matt Bernacchia said...


After reading the article it was hard for me to understand how i truly feel. I came to the conclusion after reading this that this was really my expectations rather than something surprising. This is an economic topic about how men and women act financially independently, and also a new topic to my mind that i haven't taken into consideration. After reading the section about the generosity of women and the numerical data that comes with it, my first thought was that i completely agreed and have an understanding as to why. This article addresses the topic in a rather sexist way which is rather unfortunate, speaking about women as less. I do not agree with the sexist part that comes with it however i do agree that men and women are different in there everyday actions.