2. Welcome to Econ 325 Economics of Gender Week 9 Beginning March 26

3. Monday, March 26 Your appointments with me Part 3 of paper due on April 13 20 points Theories regarding the similarities and differences Study Chapters 6 & 7 ICA Wednesday Exam 2: next Monday

4. Midterm grades were turned in yesterday Total possible points (excluding part 2 of paper) = 143 90% =A 80% = B 70% = C 60% = D Below 60% = F

5. Don’t forget Bonus Opportunity  Friedman Lecture Tonight 7:30 PM, McDonough Auditorium Speaker: Dr. Steven Landsburg, professor of economics at the University of Rochester, will speak on More Sex is Safer Sex, and Other Surprises. 2 Bonus points for attendance More bonus points for questions and or a summary for MACRO & micro You can’t summarize unless you attend

6. E-E profile for general/specific training Graph

7. All else being equal, it is harder for firms to attract employees to a job that offers specific training compared to a job that offers general training So firms offer a higher initial salaries to those who will receive specific training. Employer’s share of cost

8. All else being equal, it is harder for workers who have received specific training to find other employments than those who have received general training So firms offer a lower raises to those who have received specific training. Employer’s share of benefits

9. Who is more likely to quit in order to look for another job, a worker who has received specific training or one that has received general training? If a worker who has received specific training quits her job, she can find a job that pays less than her current job.

10. Why do firms prefer to hire men for jobs that offer significant specific on-job training? They anticipate that women are less likely to stay at the firm than men. Same cost, but lower benefits to employers This behavior is called “Statistical Discrimination”

11. Wednesday, March 28 Your appointments with me Part 3 of paper due on April 13 20 points Theories regarding the similarities and differences Study Chapter 7 Exam 2: Monday

12.  How was Friedman Lecture?  Who asked questions?  Summaries due Friday before 5 PM via an attachment to an email

13. ICA No ICA today

14. Other reasons for gender wage gap Women’s priority is family (home production) They don’t search for the best job and take the first job (sometimes low paying job) available Go wherever their husband’s job takes them  take a low paying job in the new location Their income is considered secondary  anything is good  low paying jobs

15. Gender Discrimination (Chapter 7) Exists when two equally qualified individuals are treated differently, or a more qualified individual is treated worse than a less qualified individual, solely based on their genders.

16. Types of Discrimination 1) Same productivity – different outcomes Example Pat & Chris are of two different genders Both equally productive in Job “A” Either Pat does not get the job, or Pat makes less than Chris If Pat already knows this, he/she is less likely to invest on her/his human capital  Pat will not go to school to learn how to do Job “A” (feedback effect)

17. Types of Discrimination 2) Different productivity - different outcomes Example Pat & Chris are of two different genders Pat is more productive in job “A” than Chris Either Pat does not get the job, or Pat makes less than Chris Results in misallocation of labor resources and inefficiency in production Feedback effect

18. Types of Discrimination 3) Same productivity  different productivity Example Pat & Chris are of two different genders Initially Pat & Chris are equally productive in Job “A” Because of discrimination Pat’s productivity declines and so does her /his real wage. Feedback effect

19. Empirical Studies on Discrimination Table 7.1, page 205 1. Human Capital Differences Education Experience 2. Other Differences Occupations Industries Unionization

20. Empirical Studies on Discrimination Other study About 32 % of wage differential is explained by the difference in human capital (mostly experience) About 67% of wage differential is due to other factors (like what?)

21. Empirical Studies on Discrimination Another study About 30 % of wage differential is due to people with similar human capital working in different industries or occupation

22. Empirical Studies on Discrimination Sample: University of Michigan Law School Grads 15 Years After Graduation Observation: Pay gap was small in the beginning of their career 15 years later, women graduates earned 60% of men’s salaries Reason? Shorter hours More interruptions Even after controlling for these factors, men still earned 13% more

23. Friday, March 30 Exam 2 on Monday Covers Chapters 4, 5, 6, and 7 (Page 218) Notes Slides ICAs/OCAs End of Chapter Questions How are the papers shaping?

24. Excluded topics from Chapter 4 1.Empirical Evidence on Income and substitution effects (Page 113) 2.Economic conditions (Page 115) 3.The section starting with “The World War II Experience” (PP 122-128)

25. Empirical Studies on Discrimination Another study Gave men and women the same resumes to apply for jobs waiting on tables Probability of a female applicant getting an interview at high- priced restaurants was 40 percentage points lower than male applicant

26. Empirical Studies on Discrimination Another study Blind auditions by female musicians increased their chances of their selection

27. Empirical Studies on Discrimination Another study Women were less productive than men But the gap between male and female salary was more than the gap between their productivity

28. Occupational Segregation 1) Across industries most teachers are women and most electricians are men 2) Within industries most nurses are women and most doctors are men

29. Causes of Occupational Segregation 1) Supply Side Factors Factors affecting supply of male/female workers Human Capital Theory Feedback Effect

30. Causes of Occupational Segregation 2) Demand Side Factors Factors affecting demand for workers a) Human Capital Theory Productivity Interruption in work life Short work life b) Discrimination

31. Glass Ceiling Implicit barriers to promotion of minorities Is there a glass ceiling? Old-boys network Male dominated corporate culture Stereotyped views: Balancing act Family Not aggressive/strong enough Not good bosses Table 7.2, page 217 Study the Federal Glass Ceiling Commission’s report on page 218