Pod Insights Freakonomics Radio 232. A New Nobel Laureate Explains the Gender Pay Gap (Replay) About this episode Claudia Goldin is the newest winner of the Nobel Prize in Economics. We spoke with her in 2016 about why women earn so much less than men — and how it’s not all explained by discrimination.
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2:33 Stephen J. Dubner? Hey there. It's Stephen Dubner. On the morning of October 9th, the Nobel Memorial Prize in Economic Sciences was awarded to the Harvard economist Claudia Goldin for having, quote, "advanced our understanding of women's labor market outcomes." We spoke with Goldin back in 2016 about her research for an episode we called "The True Story of the Gender Pay Gap." It is one of the most popular episodes we've ever made. In light of the Nobel Prize, we are taking the opportunity to replay that episode for you today. It's also an opportunity for us to congratulate Claudia, who has long been a friend of this show. So to Claudia, congratulations. And to you, listening, I hope you enjoy. Love to hear what you think.
3:17 Stephen J. Dubner? We are at [email protected] . We will be back soon with a new, regular episode of Freakonomics Radio.
3:28 Speaker 01 Oh, hi. I'm Sarah Silverman, writer, comedian, and vagina owner. Women make up almost half the working population, yet we typically earn just 78 cents to every dollar a man makes in almost every profession.
3:51 Stephen J. Dubner? I'm pretty sure you've heard this kind of statistic before. Maybe in a political ad? The gender wage gap is real, and women still earn about 77 cents for every dollar a man earns for working the same job. Maybe even in a State of the Union address.
4:08 Speaker 02 Today, women make up about half our workforce, but they still make 77 cents for every dollar a man earns. That is wrong. And in 2014, it's an embarrassment. Women deserve equal pay for equal work.
4:24 Stephen J. Dubner? The implication is that women are being discriminated against. True, they earn less, but does that mean-
4:33 Speaker 03 Does that mean that women are receiving lower pay for equal work? That is possibly the case in certain places, but by and large, it's not that. It's something else.
4:44 Stephen J. Dubner? Something else? Like what? That's our question of the day on Freakonomics Radio, as we try to figure out the true story of the gender pay gap.
5:08 Speaker 04 This is Freakonomics Radio, the podcast that explores the hidden side of everything, with your host, Stephen Dubner.
5:22 Stephen J. Dubner? If you're looking for someone to explain the gender pay gap, you couldn't do much better than today's guest.
5:31 Speaker 03 Claudia Goldin, I'm a professor of economics at Harvard University.
5:35 Stephen J. Dubner? Goldin has been working on gender economics for years and has personally done some of the most influential research.
5:41 Speaker 03 So I define my role by thinking about the issues of today and putting them in historical perspective and understanding what their roots are, because until you see the more distant past, you really don't know whether you're looking at something that's a little ephemeral, transitory blip, or something that's important.
6:01 Stephen J. Dubner? And how important is it for you to get hold of good data in order to reach those conclusions?
6:08 Speaker 03 It's sort of essential. I always say that I do not live in a data vacuum. I find it very hard to breathe in a data vacuum.
6:17 Stephen J. Dubner? In 1990, Claudia Goldin became the first woman to get tenure in the Harvard Economics Department. In 2014, she served as president of the American Economic Association, the AEA. Her lecture at the annual AEA meeting was called "A Grand Gender Convergence," its last chapter. You have argued, and I'll quote you to yourself, "The converging roles of men and women-
6:41 Speaker 03 ...are among the grandest advances in the last century."
6:47 Stephen J. Dubner? What do you mean by that and why is it so grand?
6:49 Speaker 03 I'm very much interested in converging roles having to do with the productive capacities of men and women. So that would be their education, their professional degrees, their life cycle, labor force participation, meaning how many years have they been productive members of the workforce. And so there are converging roles in these arenas and they have meant that men and women are significantly more alike in terms of how firms and employers would look at them and how they look at themselves.
7:24 Stephen J. Dubner? Now, we hear about the gender pay gap a lot. We're told repeatedly, including by the President of the United States and the State of the Union, that women earn much less than men for doing the same work is one of the phrases that we hear, 70-some cents on the dollar. So, first off, can you clarify what that really means? How true is that when we hear a statement like that, especially in a political arena?
7:47 Speaker 03 Well, it is true that if you took individuals in the labor force and took those who are working full-time, full-year, and took all women, took the median annual earnings of those women, and took the same thing for men, and divided the two, it would be .77 or around that, okay? And that's a number that has increased in the 19, early 1970s, it was .59, and there was a mantra, 59 cents on a dollar, that's not enough, okay? We are equal to men, we deserve more. So, is this for equal work? Is it for equal individuals?
8:27 Speaker 03 What economists do is they use data to figure out whether the individuals are the same. They try to make them as comparable as possible. They squeeze out these differences in productive attributes. They look for individuals who have the same education, the same labor force participation rates over their life cycle, et cetera, and they squeeze those out, and we still get a number that's less than one. So, does that mean that women are receiving lower pay for equal work?
8:59 Speaker 03 That is possibly the case in certain places, but by and large, it's not that. It's something else.
9:05 Stephen J. Dubner? If we are talking about a gender pay gap of whatever size, somewhere between 23 cents and zero cents less per dollar than a man, let's look at what factors might contribute to that. So, number one, what about discrimination? What is the evidence that women earn less because they're discriminated against on some dimension or another?
9:29 Speaker 03 I think it's hard to find the smoking guns. The smoking guns existed in the past. I have found many a smoking gun where you find actual evidence of firm saying, for example, "I do not hire Negroes," or "I do not hire women." I mean, you actually find these in 1939. We don't find those smoking guns now. But what we do try to do is hold everything constant that we can hold, get the best data that we can get, and what remains, we don't call discrimination, we call wage discrimination.
10:11 Speaker 03 Discrimination is such a loaded word that we don't want to use that, so we use quotes around wage discrimination. So the first thing is, what type of data do you need to do that? And it would be incredibly rich data. And a couple of people have put together data using administrative records that are phenomenally good data, that can hold lots of things constant, that could track individuals over their lifetimes and get to the answer. And the answer is that it's a pretty small number, this number for wage discrimination, once you hold lots of things constant.
10:52 Speaker 03 It's probably there, but we're not quite certain whether these differences are due to the fact that women, even those without kids, have more responsibilities or take more responsibilities in their own families, taking care of their parents, for example. So the answer is that we don't have tons of evidence that it's true discrimination.
11:18 Stephen J. Dubner? Talk for a moment about potential categorical differences between men and women that have shown up in some research. The differing appetite for competition, as some have labeled it, or in another instance, the willingness to bargain on salary or flexibility. How much might those contribute to the pay gap?
11:36 Speaker 03 I think that there's no doubt that they contribute to some degree. But let me tell you why I don't think that they go the real distance. Some of the best studies that we have of the gender pay gap following individuals longitudinally show that when they show up right out of college or out of law school or after they get their MBA, all the studies that we have indicate that wages are pretty similar then. So if men were better bargainers, they would have been better right then. And it doesn't look as if they're better bargainers
12:18 Speaker 03 to a degree that shows up as a very large number. But further down the pike in their lives, by 10 to 15 years out, we see very large differences in their pay. But we also see large differences in where they are, in their job titles. And a lot of that occurs a year or two after a kid is born. And it occurs for women and not for men. If anything, men tend to work somewhat harder. And I know that there are many who have done many experiments on the fact that women don't necessarily like competition as much as men do.
13:02 Speaker 03 They value temporal flexibility. Men value income growth, that there are various differences. But in terms of bargaining and competition, it doesn't look like it's showing up that much at the very beginning.
13:17 Stephen J. Dubner? Let me ask you about one more contributory factor. The parent penalty, what's often called the mommy tax. But how significant is that as a contributory factor?
13:26 Speaker 03 Well, it seems as if it's a very large factor, that anything that leads you to want to have more time is going to be a large factor.
13:41 Stephen J. Dubner? The noted public policy scholar Anne-Marie Slaughter, in a book called Unfinished Business, singled out what she calls the care penalty as a main driver of gender inequity. Here's how Slaughter sees it.
13:54 Speaker 05 If you take women who don't have caregiving obligations, they're almost equal with men. It's somewhere in the 95% range. But when women then have children, or again, are caring for their own parents or other sick family members who need care, then they need to work differently. They need to work flexibly and often go part-time. They often get less good assignments because their bosses think that they're not going to want work that allows them to travel or they're not going to be able to stay up all night or whatever it is. And so then you start, you know, if you're working part-time, you don't get the same raises. And if you're working flexibly, your boss very typically thinks
14:38 Speaker 05 you're not that committed to your career, so you don't get promoted.
14:42 Stephen J. Dubner? It is this pursuit of what Claudia Goldin calls temporal flexibility that Goldin sees as perhaps the most powerful explanation for the gender pay gap. As she told us, it doesn't seem as though outright discrimination or differences in competitive drive or bargaining ability can account for much of the difference, but that need or desire for flexibility in the workplace leads to a split that's very clear in the data, a split that has to do with job selection.
15:14 Speaker 03 Women often take jobs that have different characteristics, different amenities.
15:20 Stephen J. Dubner? When Goldin refers to amenities, she isn't just talking about free lunch at the office or free massages. She's talking about the ability to work flexible hours or maybe work at home some days, maybe complete a project outside the typical corporate schedule, all of which can be extremely valuable if you are helping care for your family members in addition to working.
15:43 Speaker 03 I like to think about an individual who gets a degree, let's say, a law degree. It's a woman, and now I have an individual, a man, who gets a law degree, and they graduate from law school. They're both equally brilliant, and they both get jobs in approximately the same type of firm. By and large, they're going to earn approximately the same amount when they start. Things will continue in their lives. They'll both perhaps find partners, get married, have kids. It's often the case that women will leave the very large law firms that put a lot of time demands on them and go to smaller firms or become corporate counsel, become part-time
16:26 Speaker 03 corporate counsel perhaps for a while. They will go to smaller firms where the workload is somewhat different. They may work, in fact, the same number of hours, but they may work hours that are their hours rather than the hours imposed on them by the firm. The woman will then begin to make, if she's the one who did this, she will make considerably less than the man. And a lot of what we see, not all of it, but a lot of what we see, is this choice to go into occupations that have less expensive temporal flexibility, that allow individuals to do their work on their own time.
17:12 Stephen J. Dubner? So do you find that there are bigger differences in pay between men and women between different occupations? In other words, what would be a more typical story? A man and a woman that say who are observationally equivalent in terms of aptitude and education and so on? What would be more typical? That the female would go into a profession where the average salary is lower than the man? Or that the female would go into the same profession as the man, but choose a particular type of occupation within that profession that might provide more latitude and therefore come with less salary?
17:46 Speaker 03 Right. So we have both things going on. So we know that there is what many people call occupational segregation. Nurses are female. Doctors are, they were disproportionately male in some specialties, they still are. We know that nurses earn less than doctors in general. So one might think that all of the difference in average earnings is going to be the difference because women select more into occupations that look like they're paying less.
18:24 Speaker 03 Big occupational groups that are paying less and men select into occupations in which they pay more. But they really lion's share of the difference is due to the fact that in every occupation just about, women receive less than men. And they're receiving less than men for a host of reasons. One of which is that they're not working the same amount of time. And in many occupations, working more hours or being there when the firm wants you to be there earns you a lot more. So in fact, something like three quarters of the difference,
19:05 Speaker 03 if you look at the 469 occupations in the census and you look at how much is due to the fact that women are disproportionately in certain occupations and how much is due to the fact that within each occupation, there are differences. Seventy-five percent is due to the within each occupation. Thus, another way of putting it is you could hypothetically give women the male distribution of occupations and you would wipe out only about a quarter of the difference in earnings between men and women.
19:56 Stephen J. Dubner? Can you talk for a moment about where you see the largest in-sector differences in gender pay?
20:03 Speaker 03 So what I did was I took all of the occupations in the census and then I looked at the top paying 105 occupations. So the point that I'm drawing is about $60,000 a year.
20:21 Speaker 03 So the occupations then divide into those in the corporate and finance sector, those in health, those in science and technology, which I can group together. And then there's this other group that's just very hard to put in one or the other. Lawyers, for example, would be in that one. And what I find, it's very clear, is that the gender wage gaps, when you correct for the stuff you can correct for in the census, you find that the biggest wage gaps are in the corporate, the financial sectors, also law, and the health occupations in which
21:05 Speaker 03 there is a high fraction of ownership of self-employment. So the podiatrists, for example, the chiropractors. So the ones that have the smallest difference between male and female earnings with these corrections are the technology occupations and the science occupations and the health occupations where there is a small degree of self-employment, as is true today for, for example, pharmacists.
21:36 Stephen J. Dubner? Okay, so as best as you can figure the why out, where the gap within the profession is so large, why is it so large?
21:45 Speaker 03 By and large, it appears that there's just a very high cost of temporal flexibility in certain occupations. And part of this is that people don't have good substitutes for themselves in certain cases. So you are doing a merger and an acquisition, you're a lawyer, you are a consultant, whatever it is. The client might say, "I want you there. I want you there all the time. Okay, I want to call you at 2:00 in the morning. I want you to be there on Sunday, on holidays. I want you to go to Japan whenever I say that you should." Well, that's a tremendous demand.
22:31 Speaker 03 So, an individual who values their family time would say, "I'm not doing that." So therefore, if a woman wants to-- law, for example, is a good example. If a woman wants to practice law, she has a law degree, she enjoys practicing law, being a corporate counsel would give her more flexibility. That doesn't mean that she's working fewer hours than she would have worked otherwise, but she can work her hours and she gets paid somewhat less.
23:07 Stephen J. Dubner? The big question of the gender pay gap has to be broken down into a set of smaller questions. And then, you have to find the data to answer them. When someone like Claudia Goldin does that, it's pretty obvious that the statistics cited by everyone from Sarah Silverman to President Obama isn't quite right. Because women aren't getting paid 20-some percent less than men for doing the same work. They are, however, often doing different work, or work that affords more flexibility, which tends to pay less. Now, it may be that if you put a dollar value on the flexibility, it could offset a lot of the actual salary dollars. In any case, there would seem to be some kind of, sort of, good news here, which is
23:52 Stephen J. Dubner? that discrimination doesn't seem to be the main culprit in the gender pay gap. Or, at least, it's hard to find a smoking gun, as Claudia Goldin says. But not impossible. A hack of Sony Pictures emails showed that the actresses Jennifer Lawrence and Amy Adams got fewer backend points than their male counterparts in the film American Hustle. Interestingly, when Lawrence later wrote about this revelation, she largely blamed herself. "I failed as a negotiator because I gave up early," she wrote. "I didn't want to keep fighting over millions of dollars that frankly, due to two franchises, I don't need. But if I'm honest with myself, I would be lying if I didn't say there was an element
24:37 Stephen J. Dubner? of wanting to be liked that influenced my decision to close the deal without a real fight. I didn't want to seem difficult or spoiled." So, that's another component to consider when you're talking about the gender pay gap, that even in the absence of outright discrimination, the playing fields are not necessarily equal. Some of the most compelling evidence for this fact comes from the late 1990s, a study that Claudia Goldin did with C.C. Rouse. The paper was called "Orchestration Impartiality."
25:15 Speaker 03 We found out that the best orchestras in the United States, most of them use a blind when they do auditions. They didn't in the past, and each one of them adopted this technique for having auditions. And the blind means that the individuals who are making a decision on the sound of the individual's performance do not get to see the individual, that there is a screen in front of the individual. And so we decided that since the various orchestras adopted this screen, we could figure out whether the huge increase in women in the great orchestras in the United States
25:58 Speaker 03 was perhaps due to the use of the screen.
26:08 Stephen J. Dubner? So I guess one theory might be if orchestras got a lot more female over time, it may have just been that the pool of female applicants had grown a lot or the pool of male applicants had shrunk a lot, right? But you wanted to isolate the effect of the blind auditions, correct? And what did you find?
26:24 Speaker 03 We found that blind auditions mattered a tremendous amount.
26:30 Speaker 03 Our best estimate was that it was about 25% of an increase, which is pretty large. And one of the ways that we did it, and this, I will say, was C.C.'s brilliance, was that because we had the names of individuals, we actually could track individuals who auditioned not blind and then blind for different orchestras.
26:56 Stephen J. Dubner? I'm trying to tell, I may be interpreting this wrong, but are you saying that the use of more blind auditions also had an effect of simply encouraging more females to audition for those top-tier orchestras?
27:09 Speaker 03 That's right. It appears to have led to an explosion of auditions.
27:18 Stephen J. Dubner? So that suggests that gender gap aside, which we're talking about, that what you might more broadly and much more importantly call an opportunity gap in the gender sphere is something that's not only omnipresent in certain industries, but also really hard to get at, right?
27:34 Speaker 03 That's right. I think that this is a very good example of where individuals might not come out to interview. It's expensive to do that in some sense. You have to travel to do it. You have to put your pride on the line. And so now there was just a much larger group of individuals doing these interviews.
28:05 Stephen J. Dubner? Coming up on Freakonomics Radio, now that we know some actual facts about the gender pay gap, what should be done about it? And, just as important, what probably shouldn't be done?
28:16 Speaker 03 No one's saying that we want a world in which men and women are identical, in which you look out and you just see androgynous individuals walking around in mouse suits.
28:26 Stephen J. Dubner? I'm Stephen Dubner. This is Freakonomics Radio. We'll be right back.
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30:20 Stephen J. Dubner? Today, we are talking with Claudia Golden about the infamous gender pay gap.
30:28 Stephen J. Dubner? So, you're a Harvard economist. Your partner in life, Larry Katz, is also a Harvard economist. How fair would you consider your pay in relation to his?
30:38 Speaker 03 They're exactly the same practically. I think I always make slightly more because I'm more senior than he in terms of years. And I think that the administration always thinks that if I get $5 more, that that makes it better. And it sort of sure does.
30:53 Stephen J. Dubner? It gives you bragging rights at least, right?
30:55 Speaker 03 Absolutely.
30:58 Stephen J. Dubner? Golden and Katz would both show up in the census data as post-secondary teachers. And in this case, the female teacher earns a few more dollars than her male counterpart. But what if Golden had decided some years back to find somewhere less demanding to work than Harvard? Maybe she needed to care for some family members, maybe she wanted to study opera singing on the side, whatever. So perhaps she opted out of the Ivy League tenure track for a different teaching job that didn't pay as much. Well, if that were the case, she and Larry Katz would still both show up in the census data as post-secondary teachers. But now, the female worker is earning a lot less than the male counterpart.
31:41 Stephen J. Dubner? You multiply that story by a few million, and you have a huge pay gap between men and women. In some ways, it's a self-inflicted wound. Women make choices that lead to smaller monetary returns. On the other hand, society is set up in such a way that those choices are often not really very optional. So what's to be done about it?
32:12 Stephen J. Dubner? Some people taking matters into their own hands. A record label from Portland, Oregon called Miladies Records decided to give female customers a 23% discount on mail orders to account for the pay gap. They weren't the only ones to think of this strategy.
32:26 Speaker 06 A bar in Brooklyn is charging women just 77% of their bar bills all night to highlight the wage gap between working men and women.
32:33 Stephen J. Dubner? But getting a discount on drinks or records isn't going to accomplish much. What would Claudia Goldin do? So let me ask you this. Can you point to examples of countries or cultures or maybe firms that, in your view, have successfully addressed the real root causes of the gender pay gap?
32:52 Speaker 03 In some ways, certain occupations that seem to have successfully addressed them may not have given it any thought. My favorite example is pharmacy, in which there's virtually no part-time penalty, in which there's very little ownership now in terms of independent pharmacies. We may lament that. I would certainly lament if I lost the wonderful independent pharmacy in Cambridge. But in fact, women tend to shy away from ownership, in part because it involves a fair amount of responsibility that is unpredictable.
33:39 Speaker 03 So there have been changes in pharmacy that have led pharmacists to be better substitutes for each other. The use of highly standardized drugs, for example, less compounding, less individual, less need for a particular pharmacist to deal with you. Information technologies have been absolutely essential when you go to the pharmacist. It could be any of the pharmacists working there who are intelligent and professional and can read the information about you. So some of what has happened that has been good for women comes from changes that I
34:21 Speaker 03 call organic, and they simply happen because of various technological advances that make each pharmacist a perfect puzzle piece for another pharmacist. And also, I mean, go to Silicon Valley and they don't talk about family time, they talk about playtime, and it's work-life balance rather than just work-family balance. So the more and more people in our society who value that, the more firms are going to be searching for methods to reduce the cost of this amenity.
35:00 Speaker 03 If the cost is expensive, then it's going to be the case that individuals who shy away from those jobs are going to be paid disproportionately less, and the more people who want those jobs, the more firms are going to find it costly to provide them, and they're going to come up with ways using information technology to create these puzzle pieces.
35:32 Stephen J. Dubner? It may be a natural impulse when you hear that women earn less than men to find someone to blame. One obvious villain is men, presumably for being discriminatory. But as Claudia Goldin told us, there isn't much evidence to support the discrimination argument. Another obvious villain is our institutional setup. If we could change, maybe modernize, a lot of our institutions and the incentives they offer, wouldn't that lead to more equality? Let's assume that's true. The question would then become, which institutions should be changed and how? And should we assume that governments should take the lead? In 2009, President Obama signed into law the Lilly Ledbetter Fair Pay Act, which expands
36:15 Stephen J. Dubner? the right to sue in cases of unequal pay. But that's a pretty narrow advance. Some advocates want more legislation to try to close the gender pay gap. I asked Claudia Goldin if she thinks this is a good idea, and if so, what kind of legislation makes sense.
36:33 Speaker 03 The best legislation that we can have is to change certain aspects of our school system. If family matters are important here, and I believe they are, it's not just baby care. Simply doing something for infants isn't the big deal. Most people I know who have kids will say that life was relatively easy until their kids went to the local public school, which sends them out at 2 o'clock, which sends them home in June.
37:16 Speaker 03 And the problems that they have are trying then to fill in the time to 6 o'clock, which used to be filled in in daycare, and fill in the summer, which used to be filled in in daycare. So for the children alone, it would be worth extending the day and extending the year. This is not cheap, but it's simply an extension of a...
37:45 Speaker 03 Public good that we are already producing, and it will do a world of good for working families.
37:54 Stephen J. Dubner? Interesting, but you're not calling for, advocating at least as your first choice, legislation that would change the way, let's say, firms work to create more equal opportunities or more temporal flexibility, let's say, for women.
38:10 Speaker 03 If I could figure out a way of doing that, I would have told you.
38:16 Speaker 03 But I don't think it's easy to mandate. How can you mandate that firms all figure out ways of reducing the cost of temporal flexibility and reducing the cost of having people be puzzle pieces? We're simply not going to do that. It's going to happen organically.
38:38 Stephen J. Dubner? There are some places where men are required increasingly to take family leave when they have a child. So does that kind of legislation that happens governmentally, but then at the firm level, does that suitably level the playing field by lowering the cost of temporal flexibility?
38:56 Speaker 03 Well, that doesn't lower the cost of temporal flexibility. That could change the amount of time that each parent spends with kids. So there are sort of two separate ways of dealing with this. One is changing the cost of the amenity, and the other one is changing the supply of the individuals who demand the amenity. And that might change the latter. It's not necessarily going to change the former at all.
39:29 Stephen J. Dubner? Anne-Marie Slaughter, whom we've also spoken with about this topic, argues that a lot of the solution for gender equality in the workplace lies with men, that men need essentially to be sort of resocialized to better understand their role and women's role in family care and so on. I'm curious what your thoughts are on that. That's a strong social norm in our culture that women are the, quote, "primary caregiver" and so on. I'm curious whether you think that's a necessary and/or likely change, and that might produce some benefit to everybody.
40:02 Speaker 03 Well, that is certainly related to the previous point that you made about a paternity leave, that if we mandate that men take paternity leave or give them paternity leave, that parental leave that only they could take, that you can't mandate they take it, you can simply say that if you don't take it, it evaporates. One of the reasons for doing that in the various countries that have done it is to sort of change the social norm and have fathers bond more with their kids and take more responsibility when their kids are young, and then they're going to do more later.
40:45 Speaker 03 And there are some studies, one in Quebec, for example, that indicates that it does have somewhat of an impact. So that's going along the lines of what Anne-Marie Slaughter says, and I couldn't agree with her more, that if, in fact, men leaned out more, the world would be a better place for women. How you accomplish that is more difficult. I think that it would be easier to accomplish getting the price of the amenity down than,
41:26 Speaker 03 as you just said, reprogramming all the men in the United States. So I think of these issues as these solutions in buckets, as fix the women, that is, make them more competitive, better bargaining skills, better at math, okay, fix the women, fix the infants, take care of the infants, that will do it, okay. Fix the men, which is the point that we were just talking about, or fix the organizations and the jobs, and I'm thinking more about the latter.
42:00 Stephen J. Dubner? What costs come with that convergence of the roles of men and women, especially hidden costs that we haven't considered? In other words, we've set this up as a goal of equity, especially in the workplace. Can you point to any examples where there are costs, however, to the pursuit of that equity?
42:19 Speaker 03 There are always going to be differences. There's no question. No one's saying that we want a world in which men and women are identical, in which you look out and you just see androgynous individuals walking around in mouse suits. So I'm not certain what actual costs there are. Making men kinder and gentler and more interested in their kids, how can there be any cost to that? Making women more respected in their jobs, how can there be any cost to that? Making women fiercer and better bargainers and more competitive, eh, I can see cost to that.
42:59 Stephen J. Dubner? I'm just curious, what's it like for you to hear the kind of stock political assertion about the size of the gender gap, knowing that it misses all the nuances that you've just described?
43:12 Speaker 03 It makes me feel that I have to get back in my office and do better work and write it up better and state it with more force. But I recognize that there are facts, there are truths, and there's political action. So one simply has to recognize that there are good people out there who want to make the world a better place, and they will push what they want, even in the absence of hard evidence.
43:46 Stephen J. Dubner? Claudia Goldin admits that her career has turned out pretty well. If you want to be an academic, landing in the economics department at Harvard isn't bad. Goldin is considered a true expert in her field. She's won awards, she's been celebrated. But she's also been reminded now and then that simply being female can carry costs of its own.
44:12 Speaker 03 My own story is interesting because I was asked, and I do not do consulting, and I was asked to evaluate a project that was done by a leading international agency that will remain unnamed. And the project was that, in the organization, it was deemed that women were being treated less well than men. And they did an internal study, and the internal study concluded that women were doing just as well as men and that there were no problems at all, that whatever problems were in the organization were some other things. You know, maybe there was groping, maybe there was harassment, but that didn't look like it showed up
44:54 Speaker 03 in terms of their job position and their pay. Okay, so this person calls me up and says, "We need external people to review it." And he asked me and two other people, who are men, who worked a lot as consultants. And the person said to me, "How about $2,000 for this job?" And I thought, "That's interesting," because I thought I was doing it as a favor. "That's fine, $2,000." So the three of us evaluated the internal review, found that it looked pretty good, and I received my payment.
45:36 Speaker 03 A couple of months go by, and I receive a call that said, "By the way," and remember that the project we were working on was wage and promotion discrimination against women. And I receive a call and was told that the other two men had a rate that they asked for, and so their pay was about one and a half times or two times mine. So someone at that organization actually approved three consultants, the woman receiving about half of what the men received. So there is evidence that the individual who didn't ask for anything, because I didn't have a rate,
46:21 Speaker 03 got less than the guys who did ask for it.
46:28 Stephen J. Dubner? All right. So my one piece of advice for you, Claudia, would be that you need to find out the previously agreed upon mail rate and quote that instead of letting them tell you what you're going to get. All right?
46:42 Speaker 03 Thank you very much. Well, what I'm going to do is I'm going to call you up and ask you to bargain for me.
46:49 Stephen J. Dubner? It's a deal. I'll do it.
46:57 Stephen J. Dubner? That again was newly minted Nobel Prize winner, the economist Claudia Goldin. If you want to hear more from her, I would recommend an episode of People I Mostly Admire, another show in our network hosted by Steve Levitt. It's episode 56 and it's called, What's Greedy Work and Why Is It a Problem? We are also republishing that episode today. You can find it by searching for People I Mostly Admire in your podcast app. Freakonomics Radio is produced by Stitcher and Renbud Radio. You can find our entire archive on any podcast app or at Freakonomics.com, where we also publish transcripts and show notes. This episode was produced by Greg Rosalsky. Our staff includes Alina
47:40 Stephen J. Dubner? Cullman, Eleanor Osborne, Elsa Hernandez, Gabriel Roth, Greg Rippon, Jasmine Klinger, Jeremy Johnston, Julie Canfor, Lyric Bowditch, Morgan Levy, Neil Carruth, Rebecca Lee Douglas, Ryan Kelly, Sarah Lilly, and Zach Lipinski. Our theme song is Mr. Fortune by The Hitchhikers. All the other music was composed by Luis Guerra. As always, thank you for listening.
48:10 Stephen J. Dubner? Claudia, you live in the Boston area, you teach at Harvard. Boston is offering free two-hour salary negotiation classes to every woman who works in the city. Do you think that'll have any good effect?
48:22 Speaker 03 And what time are these classes? Do I still have time to sign up?
48:26 Stephen J. Dubner? I have no idea.
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