This paper studies the gender compensation gap among high-level executives in US corpora-
tions. We use the ExecuComp data set that contains information on total compensation for the
top five highest paid executives of a large group of US firms over the period 1992-1997. About
2.5% of the executives in the sample are women. These women earn about 45% less than their
male counterparts. As much as 75% of this gap can be accounted for by the fact that women
manage smaller companies and are less likely to be CEO; Chair, or President of their company.
The unexplained gender gap can be reduced to less than 5% when one further accounts for the
fact that female executives are younger and have less seniority than male executives. Over the
period under study, women have nearly tripled their participation in the top executive ranks and
have also strongly improved their relative compensation, mostly by gaining representation into
the larger corporations. While the absence of a significant conditional gender gap implies that
women and men who hold similar jobs in firms of similar size receive fairly equal treatment in
terms of compensation, it does not rule out the possibility of discrimination in terms of gender
segregation or promotion.
discrimination
This paper investigates women's and men's labor supply to the firm
within a structural approach based on a dynamic model of new
monopsony. Using methods of survival analysis and a large linked
employer-employee dataset for Germany, we find that labor supply
elasticities are small (1.9-3.7) and that women's labor supply to the firm
is less elas~ic than men's (which is the reverse of gender differences in
labor supply usually found at the level of the market). Our results imply
that about one third of the gender pay gap might be wage discrimination
by profit-maximizing monopsonistic employers.
In this paper we study the long-term labor market implications of school resource equalization
before Brown and school desegregation after Brown. For cohorts born in the South in the 1920s and
1930s, we find that racial disparities in measurable school characteristics had a substantial influence on
black males’ earnings and educational attainment measured in 1970, albeit one that was smaller in the
later cohorts. When we examine the income of male workers in 1990, we find that southern-born blacks
who finished their schooling just before effective desegregation occurred in the South fared poorly
compared to southern-born blacks who followed behind them in school by just a few years.
Past investigations of the income gaps between Jews and non-Jews in
Israel treat non-Jews as one group. In this paper we separate the non-Jewish group into
three main religious minorities: Muslims, Christians and Druze and focus on the northern
part of Israel, where most minorities live. Using the latest Israeli census, we find
significant explained and unexplained income gaps in favor of Jews. The unexplained
gaps tend to be larger the more educated the individual. Jews have much higher
representation in the more lucrative occupations, and earn significantly more in them. In
almost every dimension Muslims suffer from the largest income gaps. Druze, on the other
hand, enjoy the lowest income gaps across most of the income distribution, due in large
part to direct and indirect benefits they reap from serving in the army. Among minorities,
Christians are the most educated and most concentrated in the top occupations, which
explains why they enjoy the lowest gaps in the highest percentiles of the income
distribution.
The Equal Employment Opportunity Act (EEOA) of 1972 extended civil rights coverage to
employers with l5-24 employees, while leaving unaffected the civil rights protection for employees of
larger finns. In conjunction with already existing state fair employment practice (FEP) laws, the EEOA
provides a “natural experiment” in which the treatment and control groups are defined by differences across
industries in the fraction of workers employed in the newly-covered establishments and across states in the
scope of the PEP laws. Using data from the Current Population Surveys, the treatment and control group
methodology is used to evaluate the impact of civil rights policy. This analysis shows that there were large
shifts in the employment and pay practices of the industries most affected by the amendment. The timing
of the relative gains and their concentration by industry and region provide evidence that the EEOA had a
positive impact on the labor market status of African-Americans.
Discrimination against women has been alleged in hiring practices for many
occupations, but it is extremely difficult to demonstrate sex-biased hiring. A change in the
way symphony orchestras recruit musicians provides an unusual way to test for sex-biased
hiring. To overcome possible biases in hiring, most orchestras revised their audition policies
in the 1970s and 1980s. A major change involved the use of “blind” auditions with a
“screen” to conceal the identity of the candidate from the jury. Female musicians in the top
five symphony orchestras in the United States were less than 5% of all players in 1970 but are
25% today. We ask whether women were more likely to be advanced and/ or hired with the
use of “blind” auditions. Using data from actual auditions in an individual fixed-effects
framework, we find that the screen increases — by 50% — the probability a woman will be
advanced out of certain preliminary rounds. The screen also enhances, by severalfold, the
likelihood a female contestant will be the winner in the final round. Using data on orchestra
personnel, the switch to “blind” auditions can explain between 30% and 55% of the increase
in the proportion female among new hires and between 25% and 46% of the increase in the
percentage female in the orchestras since 1970.
Although The Economics of Discrimination has left a large schol
legacy. we believe the empirical methods associated with the study of
and sex discrimination have had a still larger impact on practical mat
Our purpose in this paper is to give some small insight into how this
scholarly literature has ended up as a major factor in the litigation
many civil disputes where race and sex discrimination are alleged.
Low-wage labor markets are traditionally viewed as competitive,
and the possibility of strategic behavior by employers is dismissed.
However, such behavior is not impossible. This paper investigates the
possibility of tacit collusion by low-wage employers while setting wages.
A game-theoretic explanation along the lines of the Folk theorem is offered,
suggesting that a non-binding minimum wage may serve as a
focal point for tacit collusion, proposing a symmetric solution to an
infinitely played game of wage-setting. Several empirical techniques
were employed in testing the hypothesis, including hurdle models of
collusion. CPS monthly data is used for the years 1990-2005, covering
the last four federal minimum wage increases. The likelihood of collusion
at minimum wage is evaluated, as well as its dynamics during
this period. The results generally support the collusion hypothesis and
suggest that employers respond strategically to changes in minimum
wage legislation while using the statutory minimum wage as a coordination
tool in tacit collusion.
We provide new evidence on the presence and distribution of racial bias in the criminal justice system. In many states, the punishment for speeding increases discontinuously with the speed of the driver, exhibiting large jumps in fine amounts. It is a common practice for officers to reduce the charged speed to just below this jump, avoiding an onerous punishment for the driver. Using data from the Florida Highway Patrol, we find evidence of significant bunching in ticketed speeds below a jump in punishment for all drivers but significantly more for whites than for blacks and Hispanics. We estimate the bias of each officer by comparing his lenience towards whites and non-whites, allowing us to recover the full distribution of bias. The total disparity in lenience across races can be explained by a small percentage (∼20%) of officers. Officers tend to favor drivers of their own racial group, and younger, female, and college-educated officers are less biased. We then estimate a model that allows for both heterogeneity in officer preferences and driver speeds across races. Because minorities tend to live in areas where officers are harsher to all drivers, policies targeting bias have little effect on the aggregate speed gap. We find that racial bias in lenience explains 16% of the minority-white speed gap, and spatial differences in race-blind lenience explain 30% of the gap.