I'm posting this in honor of International Women's Day on Mar. 8.
Oct. 10, 2023 "Nobel economics prize goes to Harvard's Claudia Goldin for research on the workplace gender gap": Today I found this article by
Claudia Goldin, a Harvard University professor, was awarded the Nobel economics prize on Monday for research that helps explain why women around the world are less likely than men to work and to earn less money when they do.
Fittingly, the announcement marked a small step toward closing a gender gap among Nobel laureates in economics:
Out of 93 economics winners,
Goldin is just the third woman to be awarded the prize
and the first woman to be the sole winner in any year.
Her award follows Nobel honors this year in medicine, physics, chemistry, literature and peace that were announced last week. And it follows last year's three winners in economics:
Former Federal Reserve Chair Ben Bernanke,
Douglas W. Diamond
and Philip Dybvig
for their research into bank failures that helped shape America’s aggressive response to the 2007-2008 financial crisis.
WHAT WORK WON GOLDIN THE NOBEL IN ECONOMICS?
Only about half the world’s women have paid jobs,
in contrast to 80 per cent of men.
Economists regard the gap as a wasted opportunity:
Jobs have often failed to go to the most qualified people
because women either weren’t competing for work
or weren't being properly considered.
In addition, a persistent pay gap
— women in advanced economies earn, on average, about 13 per cent less than men
— discourages women from pursuing jobs
or continuing their education to qualify for more advanced job opportunities.
Goldin, 77, explored the reasons behind such disparities.
Often, she found, they resulted from decisions that women made about
their prospects in the job market
and about their families' personal circumstances.
Some women underestimated their employment opportunities.
Others felt overwhelmed by responsibilities at home.
“Women are now more educated than men," Goldin noted in an interview with The Associated Press.
"They graduate from college at much higher rates than men.
They do better in high school than men do.
So why are there these differences?
“And we realize that these differences,
although some are found within the labour market,
are really reflections of what happens within individuals' homes,
and they’re an interaction between
what happens in the home
and what happens in the labour market.”
HOW DID GOLDIN CONDUCT HER RESEARCH?
To understand what was happening, Goldin pored through 200 years of labour market data.
The task required a laborious process of sleuthing:
Women’s jobs frequently didn't appear in historical records.
Women who worked on farms alongside their husbands
or who laboured at home in cottage industries such as weaving,
for example, often went uncounted.
Goldin compiled new databases using such resources as
industrial statistics
and historical surveys on how people used their time.
She discovered that official records dramatically undercounted how much work women were doing.
WHAT DID HER WORK BRING TO LIGHT?
Correcting the record revealed some striking surprises.
During the Industrial Revolution, as the U.S. and European economies rapidly expanded and shifted from farms to factories,
women’s share of the workforce actually declined.
Before Goldin's work advanced public understanding, researchers, unfamiliar with older data, generally assumed that growing economies drew more women into the job market.
Progress in expanding female employment was slowed, in part, by women’s own expectations and the experiences they had witnessed.
Often, for example, they watched their own mothers stay home even after their children had grown up.
But their expectations could be "severely off the mark,’’ and they led some women to cut short their education because they didn’t expect long careers, the Nobel committee said in an essay on Goldin’s work.
Many women who came of age in the 1950s, for instance, did not foresee the growing opportunities of the 1960s and 1970s.
Women who grew up later did, and more of them pursued higher education.
Goldin also discovered that marriage proved to be a more serious barrier to women's employment than had been previously thought.
At the start of the 20th century,
only five per cent of married women worked,
versus 20 per cent of all women.
Until the 1930s, laws often barred married women from continuing their employment as teachers or office workers.
Those laws were eventually repealed.
And the birth-control pill, introduced in 1950, over time allowed women to make long-term plans for their
education,
careers
and families.
The proportion of U.S. women who either had a job or were looking for one rose steadily from the 1950s until the mid-1990s, when the figure plateaued.
WHAT EXPLAINS THE CONTINUING PAY GAP BETWEEN MEN AND WOMEN?
The earnings disparity between men and women narrowed as more women went to work. But it didn’t go away.
Goldin compiled two centuries of data on the gender pay disparity. She found that the earnings gap narrowed during the first half of the 19th century and then from roughly 1890 to 1930 as companies began to need many more administrative and clerical workers.
But progress in reducing the pay gap stalled from about 1930 to 1980 even though more women were working and attending college.
Goldin identified the key culprit: Parenthood. Once a woman has a child,
her pay tends to drop
and subsequently doesn't grow as fast as it does for men,
even among women and men with similar educational and professional backgrounds.
Modern pay systems tend to reward employees with long, uninterrupted careers.
And companies often demand that employees be available at all times and flexible about working late and on weekends.
That can be difficult for women who typically bear more childcare responsibilities than men do.
Speaking to the AP, Goldin expressed dismay that
women are less likely to work in America than in France, Canada or Japan
— a reversal from the 1990s when U.S. women enjoyed the world's highest labour force participation rates.
“When I look at the numbers, I think something has happened in America,'' she said. “We have to ask why that’s the case ... We have to step back and ask questions about piecing together
the family,
the home,
together with the marketplace and employment.’’
Goldin suggested that women need more help,
often from their partners,
in balancing childcare
and work responsibility.
“Ways in which we can even things out
or create more couple equity
also leads to more gender equality,”
said Goldin, who often works with her Harvard colleague and husband, Lawrence Katz.
Goldin noted another barrier for women:
Most children get out of school sometime in the middle of the afternoon.
“Very few of us have jobs that finish at 3 o’clock in the afternoon,’’ Goldin said.
“So having extended school programs is also important,
and those cost money.’’
Despite everything, she said: “I am an optimist. I’ve always been an optimist.″
Wiseman reported from Washington, Casey from Cambridge, Massachusetts. Associated Press journalist Mike Corder in The Hague, Netherlands, contributed to this report.
Oct. 12, 2023 "Progress in economics isn’t like progress in vaccines but it helps": Today I found this article by William Watson on the Financial Post:
If your family is like ours, you spent Thanksgiving in the traditional way: enjoying turkey with cranberry sauce and pumpkin pie, watching a little football on TV (Go, Als, Go!) and then, to top it all off, heading to the internet to bone up on the latest winner of the Nobel Prize in economics. For some reason the Nobel people announce it every year on Canadian Thanksgiving. Canadians don’t often win but it’s lovely to have our holiday recognized in this way.
The prize in economics is the last of the six to be announced every year, which is only fitting since it wasn’t actually mentioned in Alfred Nobel’s will, which directed that five prizes — for
“chemical discovery or improvement;”
physics;
physiology or medicine;
literature (for “the most outstanding work in an idealistic direction”);
and encouraging “fellowship among nations, the abolition or reduction of standing armies, and the establishment and promotion of peace congresses”
— be funded out of the annual interest on most of his estate, which didn’t much please his family, apparently. After a legal fuss, the first prizes were handed out in 1901.
The prize in economics — strictly, economic sciences — didn’t come along until 1968, when to commemorate its 300th anniversary, Sveriges Riksbank, Sweden’s central bank, donated funds and got the Nobel people to go along.
Nobel’s will says the prizes should be given annually “to those who, during the preceding year, have conferred the greatest benefit to humankind.”
Although just about everything since 1901 has become more present-focused, the prize-giving has gone in the opposite direction.
It’s not exactly a lifetime achievement award but most people get it for work done, not “during the preceding year,” but rather some years or even decades ago.
In a retro return to the immediacy Nobel wanted, this year’s prize in medicine went to
Katalin Karikó
and Drew Weissman,
whose work on mRNA vaccines probably did save millions of lives over the past couple of years, though their most important findings were published in 2005.
This year’s winner for economics, Claudia Goldin of Harvard, is a highly-regarded
economic historian
and labour economist
best known for three-plus decades of work on what determines women’s participation and earnings in the paid labour force, mainly in the U.S.
I’m no expert on Goldin’s oeuvre but what I like in what I have read is her clear-eyed approach to reality, as befits a PhD from the University of Chicago’s historically free-market, no-nonsense economics department.
For instance, in her latest working paper, “Why Women Won,” published the day she won the Nobel, she reviews the history of U.S. women’s rights legislation in the 20th century and public opinion toward it.
Her conclusion?
“Did this flood of women’s rights legislation make a difference with regard to their earnings?
There isn’t much statistical confirmation that it did.”
Other somewhat quirky or contrarian Goldin conclusions highlighted by the Nobel committee:
Official census data suggest women’s participation in paid work has increased steadily over time.
But if you go back and construct longer time series using various available data sources, which Goldin did, the relationship between participation and economic growth is actually U-shaped:
it falls at first as the economy starts growing and then rises, a pattern since confirmed for other countries.
In the U.S., the industrial revolution actually reduced male-female inequality in the labour market. Why?
People were mainly paid by piecework and piecework doesn’t lie:
you produce the goods,
you get the money.
As piecework gradually faded out,
however, the male-female wage gap widened.
In large part, Goldin argues, the gap reflected people’s responses to the incentives they faced.
Women were primary care-givers to children
and therefore quite rationally expected shorter careers in the paid labour market,
which meant acquiring education and training made less sense for them than for men.
Revolutionary changes in the technology of child-bearing, i.e., the birth control pill,
increased the number of years women could reasonably expect to spend
in the paid labour market
and therefore also the payoff to education,
which helps explain why in rich countries women now typically have more education and training than men (though still not in the STEM subjects).
So why does an (albeit smaller) earnings gap remain?
In her most recent book, which she discusses in a 2021 interview with Princeton University Press, Goldin talks about “greedy work.”
Employers pay a premium now for people who will be on call 24/7.
Many couples find it makes sense for
fathers to respond to the needs of greedy work
and mothers to answer to the needs of greedy kids.
“Why can’t dual-career families share the joys and duties of parenting equally?
They could, but if they did, they would be leaving money on the table, often quite a lot.
The 50-50 couple might be happier, but would be poorer.”
I know many readers will think this is all just common sense.
But there are many competing hypotheses about why things change, lots having to do with the sociology of
custom,
habit,
belief
and so on.
Knowing that social evolution has instead been driven by people responding to the economic incentives they face is a crucial lesson.
In fact, if policy-makers could learn that lesson, the returns to society might well be as great as those from new and better vaccines.
https://financialpost.com/opinion/progress-economics-vaccines-helps
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