The gender pay gap is a global puzzle that has baffled experts for decades. Common explanations include blatant discrimination and ingrained biases. But Claudia Goldin, a respected economic historian and labor economist, sees it from a unique perspective.
For years, the question of why women are paid less than men has puzzled economists. Many have pointed to bias, discrimination, and biological disparities. However, Claudia Goldin, a Harvard economist, has steered the discourse in a different direction. Her Nobel Prize-winning research provides critical insight into the nuances of the gender pay gap, offering valuable lessons for developing economic nations, particularly in Asia.
RELEVANT SUSTAINABLE GOALS
Unraveling the Enigma of the Gender Wage Gap
For decades, the gender wage gap has remained a perplexing issue, prompting social scientists worldwide to seek answers. Traditionally, explanations have revolved around overt bias, systemic discrimination, and presumed biological disparities. However, Claudia Goldin, an esteemed economic historian and labor economist, has approached the problem from a different angle. Over the last century, her extensive research reveals a quiet revolution in economic thought and policy, focusing on the concept of “greedy jobs.” These are demanding professions that disproportionately penalize women due to societal expectations of their domestic roles.
Still, in recent years, it feels like the topic of women in the economy has been sidelined, marginalized, and relegated to the fringes of the field. One very obvious example is the unpaid labor market, which is globally dominated by women—often doing care and domestic work—and is entirely unaccounted for in widely accepted standards and measures of economic activity, growth, and productivity. This enormous sector, absolutely required for a functioning economy, is still totally invisible in our measurements and calculations.
In the first week of October 2023, McKinsey and the nonprofit LeanIn published their annual Women in the Workplace report. The research, covering 276 companies across various sectors, concluded that women are still systematically held back in the workplace due to a range of factors. These include inadequate childcare, societal expectations, norms, unconscious bias, and outright discrimination.
Meanwhile, economics as presented in the media is still almost entirely male-dominated, with men disproportionately cited and quoted in coverage. According to one extensive study, just 0.02% of global news coverage focuses on seven substantive gaps between men and women in areas like pay, power, safety, authority, confidence, health, and ageism. Each of these gaps has economic implications.
Claudia Goldin’s Nobel-Winning Work on the Gender Pay Gap
The Nobel Committee lauded Goldin for providing a “first comprehensive account of women’s earnings and labor market participation through the centuries,” highlighting her role in advancing our understanding of women’s position in the workforce. Breaking barriers as the first tenured woman in Harvard University’s Economics Department in 1990, Goldin brings a unique perspective, unraveling the causes of change and identifying persistent sources of the gender gap.
Goldin’s work illuminates the challenges women face, particularly in balancing demanding jobs with familial responsibilities. She identifies industries, such as technology, science, and health, where flexible hours enable equal participation from both genders. Her research underscores the need for structural changes, advocating for more productive and better-remunerated flexible and part-time work, as well as enhanced childcare support from governments.
Goldin’s research also extends to various dimensions, including the economic history of fraud and corruption in the U.S. Her findings emphasize that understanding women’s role in the labor market is pivotal for societal progress, highlighting the interaction between gender gaps, social norms, and institutional barriers.
This situation aligns with UN research, showing that only 61.4% of prime working-age women are in the labor force, compared to 90.6% of their male counterparts. The next generation of women will probably still spend, on average, 2.3 more hours a day on unpaid care and domestic work than men. This mostly invisible labor holds women back from reaching economic autonomy and independence, a situation that impacts us all.
In a beautiful bit of irony, just a few hours before Goldin’s prize was announced, she published a working paper titled “Why Women Won.” In it, she details 155 critical moments in U.S. women’s rights history between 1905 and 2023. Then she herself became the subject of what’s certainly deserving of the 156th spot on that list.
Asia’s Path to Gender Equity
Goldin’s research holds particular resonance for developing countries in Asia, where rapid economic development coexists with entrenched gender norms. Her work challenges these nations to rethink policies and practices, encouraging a shift toward greater gender equity in the workforce. As societies evolve, Goldin’s findings serve as a beacon, guiding the way toward more inclusive and equitable labor markets.
Claudia Goldin’s Nobel Prize in Economics is not just a personal achievement; it is a clarion call for a reexamination of gender dynamics in the workforce. Her research provides a roadmap for dismantling the barriers that have long hindered women’s full participation in the labor market.
A fundamental takeaway of Goldin’s work is that the source of the gender gap is not constant as society transitions from one period of development to another. Rather, her work highlights which factors are most relevant at various stages of economic development and importantly, how multiple sources of gender gaps often interact with each other. For instance, policies aimed at improving female educational attainment—an ambition of many developing countries today—will not be effective at closing labor market gender gaps if social norms or institutional barriers keep women out of the workplace and certain jobs.
Lead image courtesy of Changemakr Asia.