Welcome to Econ 325 Economics of Gender Week 10 Beginning April 2

Monday, April 2 Exam 2

Wednesday, April 4 Part 3 of paper due on April points Theories regarding the similarities and differences Only Josh has consulted with me on this part.

Return and discuss exam 2

Tastes for Discrimination Employers, coworkers, and customers have discriminatory tastes Examples

Discriminatory Coefficient (d) Non-pecuniary cost associated with women

Employer’s Taste for Discrimination Cost of male worker = w m Cost of female worker = w f + d r If w m < w f + d r, then Male worker will be hired If w m = w f + d r, then Employer will be Gender blind If w m > w f + d r, then Female worker will be hired

Conclusion Assuming equal productivity  female worker must ask for a _______ wage than male worker in order to be hired.

Friday, April 6 Part 3 of paper due on April points Theories regarding the similarities and differences Anyone wants to meet with me? Study Chapter 7

Employer’s Taste for Discrimination Cost of male worker = w m Cost of female worker = w f + d r If w m < w f + d r, then Male worker will be hired If w m = w f + d r, then Employer will be indifferent If w m > w f + d r, then Female worker will be hired

Conclusion Assuming equal productivity  female worker must ask for a _______ wage than male worker in order to be hired.

If women are as productive as men and have lower wages, why don’t firms hire more women to minimize their cost? Why does discrimination persists in the long run? Competitive versus monopolistic industries Who feels the pressure to cut down on cost? Conclusion: Firms with monopolistic power have more tendency to discriminate. Is this true?

If women are as productive as men and have lower wages, why doesn’t demand for female workers go up resulting in their wages going up? Unions Men belong to unions more often than women Monopsony: the only firm in the area that you can work for Monopsonies pay _____ than competitive firms

Firms have more monopsony power over women than men. Why? Couples tend to move to a location where husband finds a job. Wife’s choices in the area become limited.

Employees’ Taste for Discrimination If coworker is male, male worker works for w m If coworker is female, male worker works for w m + d e Where d e is nonpecuniary cost of working with a woman

So what would a profit maximizing employer do? Will hire all men to minimize cost (segregation) Or will pay male workers higher wages than their female workers Conclusion: Male workers’ pay is higher/lower in segregated firms than in integrated firms. Is this true? Examples?

Employees’ Taste for Discrimination Male workers’ productivity declines if they are made to work with women. Profit maximizing firms won’t hire female workers