Steven Horwitz
Thanks to being linked on reddit a few months ago, my LearnLiberty video on the gender wage gap is now close to 300,000 views on YouTube. The video was one of four designed to rebut commonly held economic myths. In this case, the myth is that women earn 75% of what men do because of labor market discrimination. What’s been interesting about the reaction to the argument there is that both “left libertarians” and “right libertarians” have criticized it. That reaction tends to be a sign that I probably got it pretty much correct! However, I do want to clarify a few points I was trying to make there, and have probably made better in longer presentations of the argument at IHS seminars and other venues over the years, so that my basic points are clear. In other words, let’s tackle three myths about my argument that the claim that women earn 75% of what men do is a myth.
1. Myth: Horwitz was arguing that labor market discrimination plays no role at all in the gender wage gap.
The point of the video was not to argue that labor market discrimination has nothing to do with wage differentials, but rather to point out that there are a lot reasons and pretty good evidence to suggest that when we control for human capital, compensating differentials and the like, most of the gender wage gap disappears. The most reliable studies I know put the “unexplained residual” at 5% or less. No study I’m aware of, other than ones of very specific markets, concludes that human capital and compensating differentials and other economic factors explain the entire gap. Folks are welcome to see my Economics of Gender syllabus where we tackle human capital, compensating differentials, and discrimination models in one chapter each.
Yes, other disciplines might provide arguments and evidence for a larger role for discrimination. Great, let’s have at it. Economists need to take them seriously and they need to look at the economic evidence. Let’s see where it goes. So for my left-leaning critics:
Reality: Horwitz was arguing that only a small part of the gender wage gap remains unexplained by the factors discussed in the video, and that remainder may well be due to discrimination.
2. Myth: Horwitz thinks sexism is not causally related to the gender wage gap.
It seems like some people didn’t watch the last minute of the video as they think I was denying the existence of sexism or that sexism plays any role in economic outcomes. If you watch all the way through, I point out at the end that sexism in how children are socialized into gender roles can indeed affect economic outcomes. If it’s true that girls really are discouraged from math, for example, or if they grow up believing that certain jobs are “women’s jobs,” then they will acquire their human capital accordingly, and may well earn less than the very men they went through school with whose human capital looks different.
It also matters that men don’t do as much as women do with respect to household production. Equalize the second shift more and you’ll likely make wages more equal in the process. Why men don’t contribute more is a matter of serious contention, but it’s certainly possible that misogyny is part of the story. So yes, sexism matters.
However, that is not the same thing as saying that the gender wage gap comes from labor market discrimination. It is not labor markets that are the problem here, but the socialization of children that comes before they enter the labor market. Change the socialization and labor markets outcomes will pattern differently by gender. So yes, some portion of the gender wage gap might be due to sexism, but not necessarily or only in the labor market but elsewhere in society and the culture. If we think that sexism is bad, or if we want to see more equality in wages, then attack the sexism in the places it has the most influence, but don’t imagine that labor market interventions such as anti-discrimination laws or worse, comparable worth, are going to solve the problem. So for my left-leaning friends again:
Reality: Horwitz thinks sexism is causally related, but mostly via the socialization processes that influence the choices people make as they acquire their human capital before they enter the labor market, with labor market discrimination playing a (much) smaller role.
3. Myth: By accepting the argument that misogyny in the culture indirectly explains the gender wage gap, Horwitz is tacitly endorsing interventionist solutions, not to mention making nice to the evil feminists.
From the right side of the libertarian spectrum comes the charge that all this talk of socialization and discouraging girls from math and science is all a bunch of lefty PC talking points that aren’t really true. And from some quarters is the suggestion that if one believes that stuff, one is somehow tacitly endorsing government-enforced solutions to them. For what it’s worth, I’m persuaded by the evidence I know of outside of economics (gasp!) that those problems are real, at least to some degree. I would agree that they continue to lessen over the years, but they have not totally disappeared. And there’s no doubt about the evidence on men’s contributions to household production being low. Data from 2004 had women doing twice the hours as men. Granted that’s down from 8 times the hours 40 years earlier, but if economic theory is right in suggesting that hours spent on household production should be in inverse proportion to the relative wages of the couple (think opportunity costs), then unless the average woman is making half of the average man, men are under-contributing in the household. Again, there’s a number of possible reasons why, but the fact is there for all to see.
Accepting that sort of evidence hardly means one sees interventionist public policy as the way to deal with it, although changing some polices, such revamping the tax code to end the secondary earner bias by instituting a nice low, flat tax would sure help. Sexism is a cultural problem and there are plenty of ways to try to work on the cultural side of matters to address it. It may also cure itself as younger generations adopt different views from their parents, and the trends of the last 40 years indicate that this seems to be happening. One can be hard-headed about the market generally not being a source of discrimination, while being soft-hearted about changing the culture in ways that might lead to different, and more equal, market outcomes. Not every problem demands a political solution and persuading men that it’s a good thing to take more responsibility for raising their kids and washing the dishes is a non-policy way to address that sexism, as is more generally persuading recalcitrant men to look at women in the workplace as equals. So for my right-leaning friends:
Reality: The feminists are not only not evil, they are right about a number of the problems, but wrong about the role markets play in causing them and that the state plays in potentially remedying them. Acknowledging the existence of sexism doesn’t ipso facto commit you to any particular way of dealing with it.
Cross-posted at Bleeding Heart Libertarians.
These are very important points - quite similar to some things I wrote about racial disparities on MLK day. I've got thoughts here: http://factsandotherstubbornthings.blogspot.com/2012/01/steve-horwitz-is-exactly-right-about.html
I think different people see different "myths" as more looming and imposing than others. Your youtube video was falsely characterized, but a lot of people are (I think legitimately) concerned that there are too many people out there who do actually fit this caricature that was thrust on you.
Have you done a lot of work on labor market disparities, or did you just pull material together for the video? I've done several things with racial disparities but I'm not personally too familiar with the gender disparities literature.
Posted by: Daniel Kuehn | January 21, 2012 at 03:43 PM
A similar point was made by Margaret Simms - a colleague of mine at the Urban Institute, in an MLK-themed article this week in the Atlanta Journal Constitution (http://www.ajc.com/opinion/opportunity-still-has-racial-1305956.html).
Most of it is just recounting the levels of different disparities, but this was the important point for this discussion:
"African-Americans, as far as they’ve come since the march on Washington, have yet to achieve financial equality in America. Income inequality in the United States is growing, and the recession has made it only worse. While parents may wish for children to have an equal opportunity to succeed, the reality is that where most children end up depends on where their families start out. Moving up can be a tremendous struggle."
The roots of any observed disparity often have considerably more to do with a lot of "upstream" inequality, and much less to do with inequality at the "final stage" than people usually think.
If you are concerned about racial or gender disparities, "employer discrimination" or any late-stage discrimination is often - while not imaginary - only the tip of the iceberg to be concerned about. The real problems usually have nothing to do with those later stages.
Posted by: Daniel Kuehn | January 21, 2012 at 04:04 PM
Dr. Horwitz:
Your second paragraph under #2 suggested to me a passage from sociobiology. I am assuming that I am not making a fatal error in suggesting a pattern holds when moving from a family unit to a larger societal structure - I would like to make clear that my argument is not (nor do I believe yours to be) that there are necessarily physical differences that account for what follows; what is important here is not the conflation or artificial separation of sociological or biological differences - rather the sociological response to a disparity in roles, whatever its source.
In the "Three Men and a Baby" chapter of her book Mother Nature, Sarah Blaffer Hrdy argues that men do less "mothering" than women because "at birth the twig is already bent a little bit," quoting Ed Wilson (p. 211). The observations she uses to make this argument seem directly applicable. In the passage immediately preceding (p. 210), Hrdy writes: "Initial differences turn out to be surprisingly minor--tiny compared with the magnitude of the eventual dichotomy."
She later illustrates the situation with a theoretical example: A family (mother, baby, father) home from the hospital finds itself emphasizing the mother-infant bond, and the male notices Mom has reached the baby before the first cry, and thinks that his "intervention" would be "needlessly intrusive. There is no reason to move...Why disturb the peace by taking [the baby] from her?"
The key to the argument follows this familiar example: "Yet all along there were alternatives. She could leave her baby alone with her husband more. He could request that his wife ear earplugs, or, like Odysseus, bind herself to the mast so that she will not be able to respond [...] The neural equivalent of earplugs is what Mother Nature opted for in the case of titi monkeys, rendering mothers indifferent to the allure of infant cues. The result? Infants strongly prefer fathers, and the males 'just naturally,' without conscious determination or outside intervention, do most of the childcare." (p. 213)
To get to this point, however, I do not think it likely that sociobiologists would find that the twig was bent *just* a little bit in this case - elsewhere in the book Hrdy documents many cases of the often gratuitous and socially counterproductive destruction of matrilineal societies. Then again, Prime Minister Thatcher said "there is no such thing as society. There are individual men and women, and there are families." The situation is complicated by choices individuals make which promote strategy and adaptations that favor individuals, but not the species or society in total.
While I did not plan to write this in direct support of what Daniel had stated (I do agree completely with what he's written), I realized the connection at this point: There are ample sources of evidence that even small differences in social systems tend to bring large disparities later.
The problem is not so much blatant, seemingly easily corrected sources of disparities such as "girls being warned off math." In short, the situation is much more tangled than you admit in this passage.
I would agree that we could easily construct a theoretical system without any small biases providing a genesis of large disparities perpetuated through the system, and I would agree that this is essential in some sorts of modeling, even as background for this topic. However, any practical model seeking to tackle the problem has to recognize that the market is a process of a type just like those outlined in Hrdy's work and that to be practically useful these nuisance factors cannot be ignored, because they end up providing structure to the market - just in the way that ability to do a job and labor elasticity provide structure. In a real sense these, also, could be considered "biases" with large outcomes, and there appears to be limited utility in enshrining one type of structure as "The Market" and considering the other a nuisance factor.
Final note: Interestingly, the ways sociobiologists deal with this discrepancy is complicated. In Ch. 5 of "Social reconstruction of the feminine character," Sondra Farganis relates that Wilson "abhors the use of social policy to alter evolutionary patterns of development," because he rejects the "Lockeian clean slate" and that he is "working the same side of the street as Marcuse and Noam Chomsky, neither of whom can be accused of advancing a position that is racist or sexist in the way that Wilson's often is (p. 122)." She then notes that Wilson accepts Freud's "biology is destiny," a point Hrdy rejects (and which, in the arena of social policy, we can reject in a forthright manner.
Posted by: Edwin Herdman | January 21, 2012 at 05:54 PM
Having watched the video, I can't fathom why Steve has gotten grief over this. He presented an entirely theory- and fact-based analysis. It was nuanced and apolitical.
I am not a labor economist, but have discussed this issue with labor economists. The only way to make an apples-to-apples comparison is between never-married men and mever-married women. According to Jennifer Roback, there hasn't been a wage differential between those groups for many years.
If women continue to specialize in household production (for whatever reason), then there will be several implications. Married men will earn more than unmarried men. And married women will earn less than unmarried women. And that pattern conforms to observations. These are the voluntary choices to which Steve refers in the video.
It is not the job of economists to explain chocies, but to explain the consequences of choices. That is what Steve did, and did well.
Posted by: Jerry O'Driscoll | January 21, 2012 at 06:37 PM
Great post, but on socialisation, I must mention that when I am told of the social construction of gender, I reply with the social construction of homosexuality.
Back in the day, an old University mate of mine, Rodney Croome used to be protesting to reform to the Crimes Act.
• Rod even went into a police station to confess to abominations against the course of nature, as the Tasmanian criminal code called it. It was a gender neutral prohibition.
• The police said they could not prosecute with the other party - the abominee - coming forward as a witness. He did.
• The Tasmanian Director of Public Prosecutions then declined to prosecute on public interest grounds.
25 years later, Rod is campaigning for the right to marry. All inside one generation!
Times change, and we forget how quickly times have changed.
I often use rapid social change such as over gay rights when I must listen to someone drone on tell me how preferences and social roles are socially constructed.
They missed the 60s and 70s at least.
Posted by: Jim Rose | January 21, 2012 at 06:50 PM
Daniel: I'm not a labor economist (though I did stay at a Holiday Inn Express last night...) but I do teach an Economics of Gender course and am working on a book on libertarianism and the family, so I do follow this literature to some degree.
Jerry: I think the way the video was titled and promoted perhaps gave it a stronger claim than it really had, or that I could really address subtly in 4 mins. That's fine, which is I why I wanted to take the space here to clarify.
Posted by: Steve Horwitz | January 21, 2012 at 07:03 PM
See http://www.becker-posner-blog.com/2006/04/on-the-economics-of-national-culture-becker.html for great post by Becker on habits, traditions, and culture.
Becker points out that major economic and technological change frequently trump culture in the sense that they induce enormous changes not only in behaviour but also in beliefs.
A clear illustration is the huge effects of technological change and economic development on behaviour and beliefs regarding the family:
• Attitudes and behaviour regarding family size, marriage and divorce, care of elderly parents, pre-marital sex, men and women living together and having children without being married, and gays and lesbians have undergone profound changes in the past 50 years.
• Invariable, when countries with very different cultures experienced significant economic growth, women's education increased greatly, and the number of children in a typical family plummeted from three or more to often much less than two. Divorce rates explode, men and women married later, and living together becomes more common.
I would add that in market economies with high incomes, freedom of entry and of occupational choice, the ability to rebel against your up-bringing is greatly empowered.
This is both through your own free choices and a high enough income to live on your own, and through the emergence of entrepreneurs who serve markets of like-minded rebels.
Posted by: Jim Rose | January 21, 2012 at 07:13 PM
Jim Rose: There's a difference between gender and gender roles (and, to be rigorous, between gender role and gender identity), although I think you are getting at something more. I found your anecdote very interesting, and I see your point that society can be doing its best to suppress a state of affairs without success. However, your argument only works if we assume assume to things. First, we have to assume that with "socially constructed gender," society perfectly mirrors gender.
While we might find them farcical, some of the "socially constructed gender role" arguments do not rely on the simple "does society seem to accept it?" test your anecdote suggests. In fact some of them sound conspiratorial and depend on being at direct odds to society - I recall reading that apparently some feminist somewhere has argued that men seeking to become women are actually an example of an attempt at male dominance through displacing women from their gender roles! ("Pickering, why can't a woman be more like a man?" - My Fair Lady) We are not going to accept this as a substantiated argument, but it does show a form of argument that would not be reflected in the evidence in the way you suggest.
Secondly, your argument also seems to only allow a strong statement of the argument for social construction, which is to say you paint those who argue for some social role in gender affairs as denying other factors. The whole "nature versus nurture" debate of late assumes that there is an interplay between factors - I note that Hrdy thinks the phrase improperly frames the question and is essentially meaningless. Evolution, after all, is a process that works only in context; "genes can only code for proteins" (Hrdy), and so it would be more accurate to say that a weaker statement better reflects what most serious sociobiologists think.
In this case it is helpful to recognize that there are biological tendencies, which you mention, but there is also a social structure which does impose some limits on at least the acceptability of a social fact, reflected back onto each individual from society. As they say - no man is an island.
Jerry O'Driscoll:
"According to Jennifer Roback, there hasn't been a wage differential between those groups [unmarried men, unmarried women] for many years." This is a nice sign of progress, and it's tempting to pull a conclusion from this: Equality is more likely "when it matters" (i.e., when there is no possibility of a gender-influenced division of roles), and arguments about intra-household wage disparities can be naively interpreted as being unfair when they may not be (anecdotal evidence suggests this is not true). However, this is not the same as evidence of the superiority of the status quo.
I am wary about making claims that merely stating a problem a certain way is politically suggestive, but I think in your response this is true. The problem is that economics is not merely an encapsulated pasttime with no influence on other doctrines, and your distinction between "explaining [possible] choices" and "explaining consequences" appears to be a merely rhetorical device. Even if we agree to limit the scope of economics merely to judge outcomes on exchange rates, inflation, and unemployment, we have to conceive of possibilities that do not exist (other points on the graph). You're right that we could say economics doesn't have to provide moral or ethical supports for other policy outcomes, but economics still must be employed in judging whether those other choices are acceptable or not.
An economics of "consequences," instead of an economics of "choices," forestalls the possibility of any state of affairs that does not currently exist, in nature or in policy, being treated seriously by economics. The result is that you are essentially asking other scientific doctrines not to make use of economics for support. That is the naturalistic fallacy: We ought to recognize that there exist many possibilities for improving the state of affairs, and that these are not limited to merely issues of inflationary outcomes or the unemployment rate.
You make a further error by asserting that marriage is simply a "voluntary" choice. People can, in fact, run away from many situations, but this is not a sufficient definition of "voluntary" for most of us. Sociobiology, for instance, makes note of many situations which look like economic transactions (because, in fact, they are), and also look a bit like marriages, which were not at all voluntary in any meaningful sense. And if you start to try to define what is "voluntary," you are in fact engaging in ethics - and I thought that was supposed to be off-limits for your suggested form of economics. So here is another problem with refusing to engage with other disciplines (or the evidence).
Sorry if that's not what you had on your mind, but that struck me very much as a false division of choices. You do not have to have a faith in the messianic potential of social policy to understand that economics has a lot to say about very many topics, but it is not the only measure of the goodness of society we can use, and so it seems like an unworthy tactic to deny its resources to shed light in other fields.
Posted by: Edwin Herdman | January 21, 2012 at 08:32 PM
So it's now 75%? Thirty years ago when I was reading Thomas Sowell on the issue, it was 59%, and Sowell made the same salient point that Jerry O'Driscoll takes from Jennifer Roback: the difference goes away, or nearly does, when one compares men who never marry with women who never marry.
Edwin Herdman's apparent denial that marriage is voluntary -- in this country? with "voluntary" in scare quotes? -- was the last straw for my attempt to take seriously his weak diatribe.
Posted by: Allan Walstad | January 21, 2012 at 09:04 PM
Ever heard of a shotgun marriage, Allan? I'm not denying that marriage should be voluntary. Denial is pretending that the world always reflects an ideal state. If your idea of economics can't deal with non-ideal situations then it's being biased. If your idea economics demands that the world conform to this state, you need to admit you're dealing with ethics.
The problem with your response is more fundamental than simply being in denial, though. You didn't read enough to understand the argument, and then you constructed a straw man argument out of what you wanted to attack. Sorry, but that reflects on you, not on my "diatribe" - which can all be substantiated and sourced by empirical evidence or simple logic, not thinking borrowed from a syndicated columnist chosen because you may think that person is doctrinally pure enough for you.
I honestly regret that my responses have been to long, and that makes it all the more necessary to ask you not to waste the author's bandwidth needlessly attacking me with unsubstantiated and poorly reasoned arguments.
Posted by: Edwin Herdman | January 21, 2012 at 10:58 PM
British women in their 20s now earn 3.6% more on average than men their age, after narrowly overtaking them for the first time last year.
http://www.guardian.co.uk/commentisfree/2011/nov/27/young-women-earning-more-men
The UK pay gap for full-time workers is biggest now for women in their 50s – those least likely to have been encouraged when young to pursue a career or hang on to one after children.
But this pay gap narrows with every decade subtracted from a woman's age.
Men's earnings start to outstrip women's from the age of 29 – precisely when Mrs Average now has her first child.
Posted by: Jim Rose | January 21, 2012 at 11:25 PM
Edwin, do you really expect anyone to take seriously your appeal to "shotgun marriage?" What you've posted on this thread is largely straw-man and innuendo, not argument. If you were a bit more perceptive you would realize that much of the point of Steve Horwitz' post (and my small contribution) was precisely not to chase after some chimera of perfection but to recognize that markets and liberty permit people to make tradeoffs and pursue their individual goals reasonably well in the necessarily non-ideal world in which we live.
By the way -- you do know, don't you, that Thomas Sowell is the author of a substantial body of scholarly work?
Posted by: Allan Walstad | January 21, 2012 at 11:51 PM
"then unless the average woman is making half of the average man, men are under-contributing in the household"
This only follows if the average man marries the average woman and vice versa. If fact, the average (income) man marries a below average (income) woman and an average (income) woman marries an above average (income) man. Also, when you count only the hours spent working on housework, you ignore the number of hours spent in paid employment. Even when you count the number of hours in paid employment, a favorite tactic of non evil feminists is to exclude the amount of time spent commuting. Show me statistics that account for all these factors, and we have a basis for discussion.
Another factor this analysis fails to take into account is that women and men choose marriage partners on the basis of different criteria than each other. The fact that women tend to marry "up" the economic scale demonstrates that they are, at least subconsciously if not deliberately, choosing their marriage partners on the basis of their partners relative economic status. The fact that women who remain unmarried are far more likely to be of high economic status than otherwise suggests that men are making their choices either on other bases than economic status or that higher relative economic status counts against a woman in male estimation. The result is that men have much stronger motivation for pursuing careers that lead to high economic status than women.
Posted by: MrDamage | January 22, 2012 at 12:16 AM
That Mr. Herdman refers to Tom Sowell as a "syndicated columnist" should immediately call his knowledge of the subject matter at hand into question.
Posted by: Steve Horwitz | January 22, 2012 at 10:28 AM
Although I'm told that when one starts writing columns for the New York Times and reveal they in fact have political opinions, their academic careers must get called into question as a result... so one can perhaps understand Mr. Herdman's confusion :-D
Note to other commenters: A joke. Do not freak out.
Posted by: Daniel Kuehn | January 22, 2012 at 01:11 PM
Specialization in production is efficient in household production as it is for market production, e.g., production for firm. Indeed, in Becker's analysis, which contributed to his winning the Nobel Prize, the family is a virtual firm.
"Equality," in the sense that everyone shares the same tasks, is impossible. It is anti-economics and anti-human.
Posted by: Jerry O'Driscoll | January 22, 2012 at 02:12 PM
MrDamage: "The fact that women who remain unmarried are far more likely to be of high economic status than otherwise suggests that men are making their choices either on other bases than economic status or that higher relative economic status counts against a woman in male estimation."
We're talking about WAGES here, not "status." Generally it takes time to achieve high wages and still more time for high wages to accumulate into what might be called "status." Meanwhile, marriage is something that people tend to embark on (first marriage, at least) while young. So the timescale is wrong for the point you seem to be trying to make. Rather than high income diminishing women's chances of receiving marriage proposals, what we are seeing is more probably the result of two other factors: 1) Young women who set out to devote themselves to an ambitious career may be less interested in marriage. 2) A young woman who does not receive sufficiently desirable marriage proposals still has the opportunity to focus on a career, and as she becomes older, her accumulated experience gives her an advantage over women who have taken time out for -- or simply diverted some of their energies to -- child bearing and rearing.
Posted by: Allan Walstad | January 22, 2012 at 02:21 PM
I apologize if anybody's blood pressure has been needlessly raised on my account, so I would just like to make a note like Daniel's: Read more carefully and all will be fine. If you don't care to engage with what I have to say, it's probably best not to make half a pass at it and end up with a nonsensical view of the nature of the argument.
That a few people have chosen to fixate on facts at the very fringes of the discussion should call into question their ability to isolate the core of a logical argument, Mr. Horwitz; I think you're not operating in good faith here. Yes, I have to apologize for dismissing Thomas Sowell's acadmic work or Allan's motives in mentioning it, but you will see that I had cause to react to some scurrilous posturing. It's most interesting that nobody has made any attempt to even engage with with the basic argument (let alone the empirical evidence) I posted - which merely was intended as the suggestion of a possible expansion of Steve's point #2, not a refutation. Is the suggestion that minor differences at the beginning of a period can define the structure of disparity that detrimental to the argument?
I'm not buying what you're selling, either, Allan; your first "contribution" to this thread was to misconstrue my first argument as somehow being a denial of the goals of marriage: Yes, I assumed that if you are sloppy enough to misconstrue "situations [studied in sociobiology] which look a bit like marriages" as equivalent to "marriage," you're also credulous enough to believe that marriage always works ideally, "in this country," where people apparently are never forced by circumstances into marriage (we all have somebody in our extended family who was forced into early marriage by pregnancy, for example). Perhaps I believe that because, in point of fact, that is what you wrote. I need to stress that what I originally wrote applies not just to people, but more universally as a sociobiological explanation of why some gender roles develop and persist. This isn't some half-baked hypothesis I'm advancing. Speaking of scholarship, it is common scholastic practice to put a direct quote (even one word, such as "voluntary") in quotes, even if it is one word. It doesn't give you license to assume that the quote is some foaming-at-the-mouth liberal attempt to underhandedly denigrate mom and apple pie.
Per your second contribution, mentioning an isolated statistic does not fully flesh your argument "that markets and liberty permit people to make tradeoffs and pursue their individual goals reasonably well" which, in all honesty, is jargon. You presuppose that "markets and liberty" are under attack here, and that anybody had questioned that they can work - if we suppose they are not being retarded by nuisance factors. That is a not inconsequential distinction to make! Those nuisance factors are what I'm discussing, not the idealized construction. Whether we agree that the balance in this particular debate warrants some tradeoff in favor of policies to force equality to the detriment of liberty is closer to the question (if we presuppose that equality could be diametrically opposed to liberty, which I fear is another place in which the bias of a purely deontological worldview sneaks in and colors the argument). For what it's worth, I also favor liberty more than the appearance of equality, but again, that's not a comparison I (or anybody serious you might find yourself at odds with) would support.
Not quite incidentally, I'd already agreed with the statistics being mentioned (from Mr. Sowell) were true, so I have further reason to regret having reacted to your mention of him in the way I did. On that I was unfair, I admit, and I will apologize for it again.
Posted by: Edwin Herdman | January 22, 2012 at 03:33 PM
From Popper’s perspective, looking for evidence against your position is the way to go.
On racial discrimination, there are the well-known anomalies of Asians having way above average incomes despite racial discrimination.
The three trap-doors to poverty – not graduating high school, having a child before the age of 20, and having a child outside of marriage – are less common among these ethnic groups, I am told.
Educational achievement among 15- to 18-year-olds explains all of the black-white gap in wages among young women and 70 percent of the gap among men. Accounting for pre-market skills also eliminates the Hispanic-white gap.
Black men earn 39.4 percent less than white men; black women earn 13.1 percent less than white women.
Accounting for educational achievement drastically reduces these inequalities (9.4 per cent to 10.9 per cent for black men and 13.1 per cent lower than whites to 12.7 per cent higher for black women!
Why do racist, sexist employers discriminate against white women in favour of black women?
HT: http://www.economics.harvard.edu/faculty/fryer/files/Fryer_Racial_Inequality.pdf
Fryer starts his conclusion as follows:
• “In 1908, W.E.B Dubois famously noted that “the problem of the 20th century is the problem of the color line." America has undergone drastic changes in 102 years. The problem of the 21st century is the problem of the skill gap.
Posted by: Jim Rose | January 22, 2012 at 07:01 PM
Thomas Sowell does not deal so much with gender issues, but a great deal with racial and ethnic ones. He drills down to micro levels in his works on ethnicity.
People in different ethnic and racial groups enter adulthood with vastly different portfolios of social capital. Not "better" or "more," but different.
One of his favorite examples is that Germans (from certain areas) have immigrated around the world and ended up as brewmasters everywhere they ended up. (Think Bohemia beer, made in Mexico.)
All ethnic groups experience discrimination when they first start arriving someplace. As Sowell details over and over again, discrimination -- even of the most violent nature -- is not an obstacle to upward mobility in a free market. The Asian story cited by Jim Rose is a prime example.
When the Irish started arriving in America in the mid-19th century, they were treated as lower than black slaves. They were put to work on jobs considered too dangerous for slaves. And so on.
Posted by: Jerry O'Driscoll | January 22, 2012 at 10:03 PM
Thanks Jerry,
On German beer making, there is a literature that suggests that the first wave of migrants profit most because they sell what is unique about their culture to the host country and export what is unique about the host country to back home.
Immigrants have superior knowledge of their home country markets, languages, business practices, laws, and other matters related to trade.
Chinese restaurants exploded in number in Australia on the back of a wave of Vietnamese Chinese refugees who spotted a gap in the market in the late 1970s and 1980s and worked 18 hours a day, seven days a week to seize the day.
One Cambodian Australian told a story in a great autobiography of her and her family of how her mum, who escaped Pol Pot in 1978, went to help for a day at the family’s electrical store and did not come back for seven years.
Her mum was really good at haggling down to that price that fellow recent refugees could just afford. Her reputation spread as a place to go to get a good bargain.
Posted by: Jim Rose | January 22, 2012 at 10:59 PM
Thank you, Jim.
David Gould, whom I hired while at the Dallas Fed, is one of those who has documented the immigrant connection in trade. He found much of what you describe.
Ethnicity and race are incredibly important. They are most important for triumph and success against difficult odds.
Posted by: Jerry O'Driscoll | January 22, 2012 at 11:20 PM
thanks jerry,
I sometimes wonder whether migrants from less democratic countries do better because, given their own past experiences, they believe that they must strike out on their own and have no one but themselves to rely on. self-reliance was the only way to survive, no matter what.
A Slovenian Australian friend of mine once remarked that despite 40 years of living in Australia, her Slovenian-born father, a respectable member of the middle class, was still afraid to have anything to do with the police. Old fears die hard.
Posted by: Jim Rose | January 22, 2012 at 11:44 PM
I suppose it depends on what is meant by "minor differences". To use an example of parents and infants, it is well established that women are far less tolerant of a crying baby than is a man. Men can ignore a screaming baby, but women feel compelled to quiet the baby down. That biological difference matters for differences in child care in married couples.
We can also see social differences which emerge. Women tend to be more attracted to family-oriented and philanthropic causes; men tend to be attracted to status and power more than women. (Note: the presences of tendencies does not mean exceptions cannot be found; also, the exception does not negate the rule.) Among doctors, we see more women in family practice and obstetrics, while we see more men in more specialized medicine, including neurosurgery.
Or consider the CEO issue. It turns out that men and women are hired into CEO positions at around a 50-50 ratio. Men, however, choose to stay with the position longer than do women. It doesn't take a mathematical genius to figure out that this will result in more male CEOs. Women hold the job so long as they enjoy doing the job; men hold on because they enjoy the status and power, even if they don't like the job itself. Those differences matter.
Anyone who has a boy and a girl (as I do) knows that the differences emerge early, and without any influence. My daughter is obsessed with pink and dolls; my son, who is 2/5 yrs younger and surrounded by dolls, is obsessed with trucks.
On the other hand, my son is obsessed with shoes, and my daughter is obsessed with crocodiles, so one cannot discount odd quirks! :-)
Posted by: Troy Camplin | January 23, 2012 at 03:30 PM
This childless woman in an "eat what you kill" male dominated field who, when she was in the employ of others, never made less than her male colleagues thoroughly enjoyed the video.
I don't have a complaint per se, but I do have a comment about point #2 (forgive me if someone has mentioned this already, I didn't read all the comments).
While it has become more normal for fathers to take a more active role in their children's lives, it is impossible to socialize them into actually carrying the child.
Pregnancy is still a dangerous, hormonal and draining experience requiring a prolonged physical recovery (oh no, it's not all back to normal the minute the kid is delivered). It's hard to have a baby crowding out your organs, gentlemen! Only women can carry children, only women can breast feed and only women are wired to suffer in this particular way. No matter how much our loving husbands may desire to help us with this burden, they simply can't.
Once the baby arrives, the desire to be with the infant to the exclusion of everything else is overwhelming (I'm told:). While fathers worry and care for their children, the pull is just not as strong. Thus, I think it's not so much sexist gender roles that stand in the way of women's careers but the experience of being human. We women will always have to choose between career and family and while I don't think feminists are evil, they seem to be completely blind to this reality.
Disclaimer: I deeply resent feminists who claim to be speaking for me.
Please, more videos, Steve Horwitz. They are all fantastic.
Posted by: Methinks | January 25, 2012 at 08:51 PM
Just posted the video to facebook with the following lead in
"Best studies leave 2% or less of the gender wage gap to be explained by sex discrimination;..."
The blow back Steve has gotten is probably because the view is not framed this way; rather it is frame in a way that has probably been misinterpreted by some/many who think that Steve is saying that there sex discrimination is entirely a myth. Of course this is NOT what he is saying; he is saying only that it is a myth to think that there is a 25% wage gap advantaging men BECAUSE women of equal human capital, in identical occupations, and with equal tenure and continuity in the occupations are the victims of their gender.
Posted by: james mcclure (indiana jim) | January 28, 2012 at 08:06 AM