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Politically Incorrect Paper of the Day: The Persistence of Pay Inequality

Summary:
Gender wage gaps appear even in markets where workplace discrimination is impossible or unlikely. Uber driver’s for example are assigned trips using a gender-blind algorithm and earn according to a known formula based on time and distance of trip. Yet, a small but persistent gender gap of about 7% exists which appears to be due mostly to the fact that male drivers drive a little bit faster, choose to work in more congested areas, and have a bit more experience. Litman et al. (2020) show that the same kind of difference also show up in earnings on Mechanical Turk In this study we examined the gender pay gap on an anonymous online platform across an 18-month period, during which close to five million tasks were completed by over 20,000 unique workers. Due to factors that are unique to the

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Gender wage gaps appear even in markets where workplace discrimination is impossible or unlikely. Uber driver’s for example are assigned trips using a gender-blind algorithm and earn according to a known formula based on time and distance of trip. Yet, a small but persistent gender gap of about 7% exists which appears to be due mostly to the fact that male drivers drive a little bit faster, choose to work in more congested areas, and have a bit more experience. Litman et al. (2020) show that the same kind of difference also show up in earnings on Mechanical Turk

In this study we examined the gender pay gap on an anonymous online platform across an 18-month period, during which close to five million tasks were completed by over 20,000 unique workers. Due to factors that are unique to the Mechanical Turk online marketplace–such as anonymity, self-selection into tasks, relative homogeneity of the tasks performed, and flexible work scheduling–we did not expect earnings to differ by gender on this platform. However, contrary to our expectations, a robust and persistent gender pay gap was observed.

The average estimated actual pay on MTurk over the course of the examined time period was $5.70 per hour, with the gender pay differential being 10.5%.

In this case, however, neither experience nor task choice nor demographics appears to explain the difference. One interesting finding is that women are more likely to choose tasks with a lower advertised pay–perhaps men are just a bit lazier. Who knows? People are different.

N.B. The authors go out of their way to plead that they are not in fact politically incorrect.

The post Politically Incorrect Paper of the Day: The Persistence of Pay Inequality appeared first on Marginal REVOLUTION.

Alex Tabarrok
Alex Tabarrok is Bartley J. Madden Chair in Economics at the Mercatus Center at George Mason University and a professor of economics at George Mason University. He specializes in patent-system reform, the effectiveness of bounty hunters compared to the police, how judicial elections bias judges, and how local poverty rates impact trial decisions by juries. He also examines methods for increasing the supply of human organs for transplant, the regulation of pharmaceuticals by the FDA, and voting systems.

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