Wage Discrimination

In our last episode of the econ blog, we examined the discrimination in prices that men and women pay for similar products/services, haircuts being the most explicit example.  But now that we are in Unit 4 (and looking at factors of production), it is appropriate for us to examine what could be another example of discrimination:  the pay gap between men and women.

Provided here for your perusal is a very interesting chart courtesy of The New York Times, showing the wage gap between men and women at a variety of jobs.  (On the left hand side of the page you will see color-coded occupations; click on one to get more information on the jobs within that category).

Provided here for your ponderment is an article from The Economist looking at the issue of labor force participation by women in a variety of countries.  Consider these two sources, and answer the questions below.

• Describe the history of labor force participation by women.  Historically, how involved have they been in the labor force?  In what sorts of jobs?
• How has the gap closed?
• What economic benefits and costs have accrued as a result of more women in the workforce.
• Carefully examine the chart on the Times website.  Using your knowledge of MRP and derived demand, could there be any economic justification for the wage gap?  Explain why or why not.
• Note:  this can quickly become a very contentious, political, and decidedly uneconomic discussion if we are not careful.  For this particular question, I'm asking you to use your knowledge of derived demand to answer the question, not your knowledge of ethics, business, or anything else

Your first post on this issue is due by midnight on Saturday, December 3rd.  Your second post will be due by midnight on Sunday, December 11th.

Addendum:  For your second post, I'd like you to consider the productivity improvements on the continent of Africa.  This article summarizes one of the major influences on African productivity:  cell phones.  After reading the article, consider these questions:

• Explain the improvements to the economy since cell phones became popular.
• Using your understanding of marginal revenue product and derived demand, explain how increased cell phone penetration throughout the continent will help improve economic conditions.
• How might cell phones be used to effectively improve productivity in Africa?  In particular, keep in mind that many in Africa are still farmers...it's easy to see how a cell phone would help a banker, but how does it help a farmer?

This post is due by midnight on Sunday, December 11th.

Price Discrimination, or Discrimination?

In class recently we discussed the different types of price discrimination.  As I was driving home from work yesterday, I found myself at the cafe buying a cup of coffee.  Next to the cafe was a barber shop, catering to cutting men's hair.  Nearby the barber shop was a salon, catering to cutting women's hair.  The salon was much more expensive for a haircut.  I'm not talking about shampoo, or curls, or anything else.  The haircut at the barber shop was $10, at the salon it was $15.  I started thinking about this in economic terms, because I am a nerd.

Some internet trolling led me to this article, which discusses the differences in price that genders pay for products.  My question to you is this:  are these examples of price discrimination, or are they examples of "real discrimination"?

Consider the following below:

• Why do you think that there is a price difference between the salon and the barber shop?
• Are some of the products mentioned in the article examples of price discrimination, or are they examples of old-fashioned gender discrimination?
• Is price discrimination bad?  Should it be somehow outlawed or curtailed?
• The author seems to suggest that this price discrimination is not just a harmless case of charging women more for shampoo; subprime mortgages and other large purchases seem to fall into this category.  Is this an example of price discrimination, gender discrimination, or is there perhaps a perfectly "legal" reason that more women have worse mortgage rates or higher premiums?

The first blog post on this topic is due by Saturday, November 19th at midnight.  The second post will be due on Sunday, November 27th at midnight.