Do Women Earn Less Than Men?

Another contemporary economic myth is that women make 75 cents for every dollar men make, because they're discriminated against in the labour markets. Like other myths this does have a kind of truth in it, so for example: If you add up all the incomes of women in divide by the number of women in the labour force and then do the same thing for men, what you'll find is that on average women do make about 75 percent of what men do. What's happening here is not discrimination in the labour market, but differences in the choices that men and women make about investing in their knowledge, their education, their skills, their job experience, will need to then getting paid different salaries. Economists talk about people's human capital. And by human capital we mean: the knowledge, the skills, the education and the job experience that people have. And economists are used that people get paid wages according to that human capital. It turns out that men and women invest very differently in their human capital. We can see that in four different ways: First of all, educational choices. Men for example tend to go to fields like engineering. Women tend to go in the social sciences, into psychology, into nursing and so when men are making higher salaries as engineers or perhaps in the business world, women tend to end up in jobs in which their salaries are somewhat lower. So even they all may have the same years of schooling the different choices they have made about their majors lead to them working in different areas and getting paid differently. Secondly men and women have different expectations about work. For example: if women expect down the road to take time off to raise children they make different choices today about what kinds of skills they will aquire and if they imagine they will be working full time for the rest of their lifes. And we know historicly that men and women in the 1960's and 70's didn't imagine that they would be working full time at age 40 and did up making choices that led them to have jobs when they will work at age 40 that didn't pay as well as they might have otherwise younger women today. Of course, are more likely to imagine themselves working at age 40 and therefore make different investments today. Another difference between men and women is ??? part time work. Women are much more likely then men to work part time. Men are like to work full time. And part time working for the same kinds of jobs tends to pay less then full time work. And women tend to prefere the part time work more than men, because women still tend to take on majority of the responsibility for children in the home. Finally men and women ... different in terms of their tenure on the job by the way in which their career getting interrupted. If it's the case, that women take time after the work to raise children. That will have an impact on their salaries down the road So if we put these four things together what we get is that the difference between men and women's pay is not the result of the labour market discrimination But of the choices that men and women make before they had to the labour market or even when they're in the labour market. about the kinds of job they wanna have, in the way they wanna balance a family and work. Studies have tried to control for all these factors have shown that if you take a man and a woman, same experience, same education, same job and compare their salaries what you find is that women make about 98% what men do. So that gendre wage gap pretty much disappears. In some jobs women made actually more. Now I might will be decased, that women are being descriminated against. That sexism is a problem In the choices that women make, for example girls ?got? away from math class. ... in other kind of classes. It's also certainly decased that ? expectation about women's roles ? caring for children and a household and men's roles about caring for children and a household are very different. And if we think those are poor choices, if we wanna see women's pay more equal to man what we need to do is convince more women to going to area such as the sciences, mathematics and engineering and we need to convince men to take more responsibility for children and a house. When those begin to even out we'll see wages begin to even out as well. But in the meantime whatever choices men and women make the wages they're paid in the market will reflect the productivity associated with those choices and not the result of discrimination.