When male CEOs have daughters, relative pay for women at their firms goes up

http://www4.gsb.columbia.edu/ideasatwork/feature/7219454/Like+Daughter,+Like+Father

by pessimizer • 13 years ago

298 239 13 years ago

www4.gsb.columbia.edu

This, alongside the recent "I put Mr. on my CV and got a job" is fascinating. I have had to rethink my own -isms over the years and its amazing just how prejudiced a right-on liberal has turned out to be - its almost as if I evolved in a totally different environment.

RodericDay2• 13 years ago

same. well, different articles, but same story.

smsm426• 13 years ago

Note that plural of anecdote is not data. Neither is singular. I.e. how often do you read articles "I put Mr. on my CV and I still have no job" on the front page of HN? Clear setup for survivorship bias here[1].

[1] https://en.wikipedia.org/wiki/Survivorship_bias

eeky• 13 years ago

The gender wage gap is a well-documented, persistent, and worldwide phenomenon wherein women earn, on average, an estimated 9 to 18 percent less than men who have the same job descriptions and equivalent education and experience.

If women were 18% more effective then men, then this is a surefire way to get rich:

Step 1: Start a business and employ only women

Step 2: Crush your competitors by being 18% more efficient

Heck, even if you could find a way to cut costs by 1% in an industry, that's huge.

RodericDay2• 13 years ago

how would you be more efficient? you would be just as efficient.

unless you paid them 18% less. in which case you'd be exploiting their situation.

Goronmon• 13 years ago

unless you paid them 18% less. in which case you'd be exploiting their situation.

Well, yes, but the point is, ethics aside, if it was as simple as just hiring from an entire subset of potential employees who are cheaper than others, why wouldn't you do it in order to have a more profitable business?

tomp2• 13 years ago

You wouldn't pay them less. You would simply put up a job ad that had salary 17% less than the market rate for men. Then, men wouldn't apply for the job, but equally efficient women would.

It's a thought experiment that suggests that the wage gap doesn't exist.

papsosouid21• 13 years ago

Yeah, the "wage gap" myth has been debunked many times over, it really destroys someone's credibility when they pretend it exists.

http://www.theatlantic.com/business/archive/2013/05/the-bigg...

rayiner14• 13 years ago

I'm not sure what about this chart suggests that the wage gap doesn't exist: http://cdn.theatlantic.com/static/mt/assets/business/Screen%....

king_jester3• 13 years ago

This doesn't debunk the wage gap, only that the wage gap is not caused by differences in pay between men and women doing similar work in similar roles. The wage gap has always been structural: women tend to be prevalent in lower wage jobs or are penalized more for default expectations about raising children or domestic work. Also, men are more common the higher in company/corporate structures you go, so naturally women do not make as much because they are not as represented in those higher salary roles.

mcguire4• 13 years ago

http://www.americanprogress.org/issues/labor/news/2013/04/09...

"Of the 534 occupations listed by the Bureau of Labor Statistics, women earn more than men in exactly seven professions. Together, these seven occupations account for about 1.5 million working women, or about 3 percent of the full-time female labor force. The remaining 97 percent of full-time working women work in occupations where they earn less than their male counterparts."

Property, real estate, and community association managers. Women's earnings as a percentage of men's: 60.6%; percentage of women in the occupation: 57.4%

Bookkeeping, accounting, and auditing clerks. Women's earnings as a percentage of men's: 100.3%; percentage of women in the occupation: 87.0% (One of the seven occupations where women earn more than men.)

antimagic2• 13 years ago

No, it really hasn't. You're suggesting that women actively seek out lower-paid, lower-status work. Just the other day there was an article on HN talking about a guy that was getting job applications rejected until he clarified his gender on his CV.

If you're a woman that runs into this discrimination, your only choices are to lower your standards for a job, and accept one that is lower paying, or to not work at all. All of a sudden the argument that women doing the same job get the same pay seems rather weak, because it's far from clear that women have the same opportunity to get the same job in the first place. All of a sudden, the lower remuneration of women is once again caused by discrimination, just not salary discrimination.

rayiner14• 13 years ago

I remember reading an article, in the Economist or maybe the Atlantic, describing a South Korean company's initiative to take advantage of the country's large pool of highly-educated married women who are marginalized in the workforce.

dylandrop9• 13 years ago

So you're proposing that because women given 18% less in wages that we should take advantage of that fact, underpay them, and contribute more to gender inequality in the workplace?

I'd love to see what your female coworkers think of this post.

mikeash3• 13 years ago

He is proposing that it could be done, and thus anyone who doesn't care about the ethical implications and wants to get rich would be doing it. That nobody is doing it, despite no shortage of unethical people who want to get rich, suggests that it is not true.

benmanns• 13 years ago

eeky is suggesting that, if there is a gap between male worker output/male worker pay and female worker output/female worker pay (which I'm unqualified to make a comment on), someone would arbitrage this gap to make an enormously profitable company until the gap closes. There is no way to "hire all the females" without salaries rising.

JamesArgo• 13 years ago

This is basic rational behaviour, and would disincentivize companies from discrimination once a few began exploiting the inefficiency. Nothing would destroy the wage gap quicker than widespread exploitation of said inefficiency.

kevinpet• 13 years ago

You don't understand economics if you think that's what would happen. If women actually make 18% less purely because they're women, companies who realize this will be able to hire well by paying women only 15% less. More people will catch on and see they can hire qualified women for only 12% less. And so on until the prevailing price represents something other than "just because they're women".

Tichy5• 13 years ago

No, the question is, why wouldn't anybody do it if it were possible? Are all investors (even female ones) so against women that they'd rather leave billions of dollars on the table than employ women? That seems extremely unlikely. So it seems more likely that other forces than discrimination are at play, for example female job preferences (type of profession, flexibility, part time, location...).

darkarmani2• 13 years ago

I can't find a reference right now, but didn't Warren Buffet do this when he was starting out? I could be wrong, but i feel like he realized that women could be hired at a much lower salary way back when they were be blatantly discriminated against.

gwern• 13 years ago

I believe Alan Greenspan did exactly that (vaguely remember reading it in his autobio); perhaps you're thinking of him

s_baby4• 13 years ago

You're probably thinking of Warren Farrell. He was writing a piece for the NYT on the wage gap when he thought "If workers can be bought for 75cents to the dollar then surely someone in the market would have taken advantage of this." The lack of case studies on any such companies is a telling sign that the "wage-gap" is more nuanced than just discrimination.

mistercow8• 13 years ago

There are a couple of big errors in your reasoning:

1. You're attacking the top of the range. If you want to reason effectively, you can't give the side you agree with an advantage by picking the easiest opposing argument to knock down. You should be considering the bottom end of the estimate range.

2. You fail to account for Amdahl's law and assume that an X% improvement for one factor will lead to an X% improvement overall. In fact, this will only apply to skilled¹ labor wages of employees directly working for you. Yes, there are industries like advertising and software development where that is a huge chunk of total expenses, but they don't tend to be ones where wages are tightly calibrated.

3. You assume that the gender gap would have to be homogeneous. It is possible that in situations where skilled labor is a big enough chunk of expenses (see #2) to make this a strong strategy, the gender gap is much smaller.

4. Most people do not think they are sexist. They believe that they can look at resumes and evenly weigh different applicants without letting gender color their perceptions. Most of those people are wrong. But if you truly believe this about yourself, then the "hire only women" strategy is less optimal than the "hire the best candidates for the money" strategy. If you do think you are sexist, you can probably come up with a better strategy to counteract your bias than hiring only women.

4. You assume that markets are efficient. There are a number of practical factors getting in the way of this strategy being implemented. Take the intersection of people who believe there is a large enough gender gap to make this work and people who believe that they are too sexist to weigh applicants fairly. Intersect that with people who can't research effective ways to counteract gender bias. Intersect that with people who wouldn't have a problem exploiting the gender gap. Intersect that with people with the savvy necessary to start a successful business (I think we may be down to about twelve people). Intersect that with people with expertise in an industry where the strategy will work. Now take that tiny set of people and filter out the ones who just get unlucky. The remainder still have to manage to maintain the policy once the company grows to the point that they don't have total control over it.

¹ Unskilled labor gets outsourced, and in the Chinese manufacturing industry, the gender gap is exploited heavily.

rayiner14• 13 years ago

The gender wage gap is a well-documented, persistent, and worldwide phenomenon wherein women earn, on average, an estimated 9 to 18 percent less than men who have the same job descriptions and equivalent education and experience.

Interesting fact: in the U.S., single, childless, women under age 30 in urban areas earn more (10-20% in cities like New York) than single, childless, men under age 30. See: http://www.time.com/time/business/article/0,8599,2015274,00.....

This is not to undervalue the statistic presented in the article, but I'm always a bit wary of comparisons involving "equivalent education and experience." In Denmark, for example, 20-30% of women (depending on the study) work part-time, versus 8-10% of men. How do you compute "equivalent" experience with a part-time worker? Is 5 years of working an 80% work-week "equivalent" to 4 years of working full-time? Does a 30-year old woman who took 2 years off after college for childcare reasons have "equivalent" experience to a 28-year old man who did not? Mathematically that works out, but part-time work and time out of the workforce are death-blows to a resume, far out of proportion with the resulting differential in actual amount of experience.

I appreciate the ideas discussed in the article, but as the father of a daughter and the husband of a very ambitious woman, I have as slightly different perspective on the issue. Yes, it is important to avoid bias that results from the perceptions of men higher up in the hierarchy. At the same time, it's crucially important to look at the other irrationalities in the system. I think it's irrational that a women who takes a year off after the birth of a child is viewed by HR managers in a worse light than a man who took a year to backpack across Asia. I think it's irrational that men are never expected to be the ones who downshift their careers for a time to help raise kids. I think it's irrational that a period of downshifting is perceived as such a negative light in the first place.

btilly• 13 years ago

The fact you point out is a nice illustration of Simpson's paradox.

By education level (subdivided if you wish by educational specialty), women consistently make less than men. But women comprise about 60% of the entering college class, and a similar portion of recent college graduates. The result is that on the whole, women make more.

That's why "equivalent education and experience", as flawed as our attempts to measure them might be, is a very important qualifier.

rayiner14• 13 years ago

I'm not disputing that--I'm trying to muddy the issue. I meant to link to the Time article that discusses how the gap increases over time, to segue into my point about child rearing: "While the economic advantage of women sometimes evaporates as they age and have families, Chung believes that women now may have enough leverage that their financial gains may not be completely erased as they get older." (http://www.time.com/time/business/article/0,8599,2015274,00....).

draugadrotten3• 13 years ago

But women comprise about 60% of the entering college class, and a similar portion of recent college graduates.

Isn't it wonderful how easy it is to ignore that college education is biased towards women and women's needs , and that men are put at a giant disadvantage when it comes to education.

I can imagine how the headlines would read if the numbers would have been 60% men and 40% women in college.

Goladus• 13 years ago

That's why "equivalent education and experience", as flawed as our attempts to measure them might be, is a very important qualifier.

It's important, but how does one really qualify for equivalent education and experience? Usually when I see articles make assertions about the wage gap, the nature of the control for that equivalency is not stated, and the reader is left to assume that Simpson's paradox has been addressed. Never answered are the question about whether they've controlled for, say, two different MD specializations with different earning potential, different courses taken during a single degree program, or degrees from different institutions, or any of the other potential educational backgrounds that might be relevant.

Besides, in a market economy, education and experience are not valued, performance is, where sometimes future performance must be predicted. Education and experience are merely one predictor of performance.

This CEO study is interesting because it sidesteps the equivalent education and experience question. But that still limits its applicability and leaves plenty of unanswered questions about why the differences were found.

lsd5you• 13 years ago

It could be that the fact that urban single childless women earn more is a sign of things to come - a wave that with time will propogate to all ages and locations.

Now it could also be that this is the point in their lives when society values women the most and this is why they get paid well at that age. Attractive young women are desirable as they make other (especially male) employees happier as well as having advantages in certain roles (e.g. sales). This 'premium' they enjoy is despite the risk of child birth being at its highest.

I know that this is very cynical point of view, but is it unrealistic? I have definitely witnessed it and it could well be a significant factor. Male attitudes to women are an extremely strong force in shaping society, and we might well expect them to go as far as distorting the job market as well. I know it is a little bit sad to undermine female accomplishment in this manner, but it is quite plausible.

This mechanism would also contribute the glass ceiling. It is desireable to have young,attractive women around, but not to promote them to the more senior positions.

estebank• 13 years ago

I know this will be seen as misogynistic, but it's far from the intention: in at least one latin american country (so it can possibly be just a matter of that society) office drama is kept in check while there is <50% of women in the office (percentage taken out of my posterior). Above that the amount of backstabbing and mean gossiping going around makes the places unbearable to work in. And this is not something I've seen only myself, as my female friends have independently made comments about this.

Of course, I encourage equal opportunities, but there are some weird social interactions depending on the group's composition. This can be seen in male predominating places as well, which can be just as toxic (if not more) to somebody who doesn't look like the rest. I'm just pointing that hiring women is not all happiness all around, because hiring people is not happiness all around.

I guess it comes down to homogeneity, in the same way you can claim there is no racism in countries with low inmigration and no heterogeneous population.

Women in charge are usually much better at playing office politics, and I mean this as one of the highest of praises in an office setting. Being able to navigate through all the bullshit while keeping sane is precisely what somebody in a big company needs. I'm reminded of George Carlin's comment on God: "I'm convinced that if there is a god. It must be a man, because looking at the state of things, no woman would have fucked up so badly."

So no, hiring young, attractive women and not promoting is completely backwards. You hire women that you will promote, because they are so much better at leading.

That being said, all generalisations are wrong. I've met women and men alike that have been backstabbing misanthropes, but believing that men and women are equals is like denying that Dutch people are tall, or that I'm not too short to reach the top drawer at my house. That's why you have specialisation, I won't play basketball and it is unlikely there is a Dutch jockey. If you are hiring and thinking from the beginning in terms of men or women you are missing the real value of that person, which may or may not align with your precognitions.

EDIT: got the joke wrong (first "woman" is "man")

Domenic_S8• 13 years ago

Now it could also be that this is the point in their lives when society values women the most and this is why they get paid well at that age.

Troubling. Why would this be? What does the System have to gain by valuing women of prime child-bearing age more than women of other ages?

Less cynically:

Women also have a "career option" not available to men: mother, and by extension stay-at-home mom. Is it possible that this group of women self-selects out of the workforce -- or the other way around, the women that achieve high career status tend to select out of stay-at-home motherhood?

yread• 13 years ago

Interesting fact:

Interesting indeed, do you have any other source for it than the 3 year old report? Perhaps it was an artifact of the crisis... manufacturing imploded and with it men's jobs were hit the hardest.

mcguire4• 13 years ago

Interesting:

"...he found that the cities where women earned more than men had at least one of three characteristics. Some, like New York City or Los Angeles, had primary local industries that were knowledge-based. Others were manufacturing towns whose industries had shrunk, especially smaller ones like Erie, Pa., or Terre Haute, Ind. Still others, like Miami or Monroe, La., had a majority minority population. (Hispanic and black women are twice as likely to graduate from college as their male peers.)"

A hypothesis: all three characteristics seem to rest on a skills difference. Many men prefer non- or semi-skilled jobs and would find limited employment in those situations.

erikpukinskis2• 13 years ago

"Interesting fact: in the U.S., single, childless, women under age 30 in urban areas earn more (10-20% in cities like New York) than single, childless, men under age 30."

For anyone reading along who is checking facts:

* The number from the "report" is actually 8%, not 10-20%.

* This is not a peer reviewed finding, it is a report by a company called Reach Advisors.

* The report, according to Time, says that in 147 of the 150 largest cities in the U.S the median income is 8% higher for women. That might mean that the differential is lower than 8% in those other 3 cities, or it might mean they filtered out 3 outlier cities, we don't know.

* That's 70 million people, about 22% of the population (I added up the numbers here: http://www.citymayors.com/gratis/uscities_100.html)

* Women age 20-30 comprise about a quarter of the working age women in this country (20-60) ballparked from here: http://www.census.gov/prod/cen2010/briefs/c2010br-03.pdf

* So when people say "young women in urban areas" we're talking about maybe 5-10% of women.

* And the numbers also only apply to childless women, but I have no way to find out what the child-having rates are amongst 20-something women in those cities. Looking at this map, I'd expect a strong majority of those women to be childless: http://www.cdc.gov/mmwr/preview/mmwrhtml/mm5419a5.htm Regardless, any effect of discrimination-based-on-pregnancy-history would be hidden in this population.

* The report in question does not appear to control for educational experience, jobs, etc. So for all we know there are simply more college-educated women in cities than college educated men.

rayiner14• 13 years ago

* The number from the "report" is actually 8%, not 10-20%.

8% is the average for the 147 cities studied. The number was 17% for New York ("But the new study suggests that the gap is bigger than previously thought, with young women in New York City, Los Angeles and San Diego making 17%, 12% and 15% more than their male peers, respectively.")

So when people say "young women in urban areas" we're talking about maybe 5-10% of women.

Right. I noted the qualifiers up front ("single, childless, under 30, in urban areas.") The intent was to look at a sub-set of the population where women do earn more and analyze the implications of the characteristics of the subset to the whole population. Specifically, young single women in cities out-earn men, but their earning power erodes as they get older. That's a very relevant and telling observation.

Retric• 13 years ago

I don't see why you care what 6 year olds or retired women make, rendering your 5-10% meaningless. So really ~25% of women make more than there male counterparts.

faet• 13 years ago

If you read the full report, and you compare by race men still make more. Childless white men make more than childless white women. Childless Hispanic men make more than childless Hispanic women. Childless black men and women make about the same. White women make more than Hispanic men.

Due to a larger ratio of white women : minority women compared to white men : minority women, it skews the "Women's earnings" up.

There are many reasons why various groups make 'more' or 'less' but it is kinda disingenuous what people try to 'prove' with this report.

glesica• 13 years ago

The part about not controlling for educational experience is probably a pretty critical flaw considering the fact that women outnumber men in colleges. Of course that is itself a tricky problem since men and women tend to choose different majors (for a whole host of reasons, I'm sure, some undesirable and some benign), but just leaving it out of a study is irresponsible.

vacri• 13 years ago

So when people say "young women in urban areas" we're talking about maybe 5-10% of women.

In the midst of all that fact-checking and debunking, you throw out this wholly unsupported and claim with an invented number?

ryguytilidie• 13 years ago

I think this is a phenomenon that extends well beyond pay. As members of congress have shown us, if you have a gay child you will go from a violent hate toward gays to a complete acceptance. If you need an abortion, abortions are somehow moral, even though they are the devils tool when used by others.

It's things like this that made me wish that as a society, we were better at putting ourselves in the other persons shoes and having our viewpoint be based on something other than our thoughtless, engrained "morality".

danielharan• 13 years ago

Putting ourselves in the other persons shoes is the critical skill for creating a better society.

Too often we promote assholes at work, and ideologues to public office. Anyone that changes their mind due to facts is guilty of a "flip-flop".

We need to start promoting leaders that have a track record of empathy for people that are unlike them.

dominik• 13 years ago

Do to others as you would have them do to you?

jbooth2• 13 years ago

That sounds like some sort of godless, unchristian commie talk.

jamesaguilar• 13 years ago

"Do unto others 20% better than you expect them to do to you, to correct for subjective error." -- Paraphrased from Linus Pauling, apparently. http://www.goodreads.com/quotes/138002-do-unto-others-20-bet...

JabavuAdams2• 13 years ago

Don't do unto others what you would not have them do to you?

smsm426• 13 years ago

Should the policemen than release all the criminals from the jail? They'd want to be released if they were in jail.

jopt• 13 years ago

Or rather, to stop pretending we can put ourselves in other's shoes.

Talking to eg. abortion opponents, I usually get the impression that they have done a few thought experiments. They, if you'll allow the straw man, assume/imagine that faced with the same tough decision they would never themselves decide to eg. have an abortion. They're appalled that others (in practice) would choose to do what they (in principle) decide against or vice versa.

As you say, these principles are poor predictors of what people will choose to do in personal, life-or-death reality. Things like the fundamental attribution error make policies based on what-I-would-do-in-a-hypothetical-situation just as impractical as static, by-the-book morality. Perhaps there's a third option.

nawitus• 13 years ago

The 'wage gap' actually mainly exists because women work less hours per year (up to ~20% less), and because they they work in different industries, and on the whole do different jobs. There's no discrimination.

shadowfox• 13 years ago

There's no discrimination

That is a fairly blanket statement that could use some backing up.

quandrum• 13 years ago

There's no discrimination.

Or rather that the discrimination is cultural and leads to life choices that make the wage gap structural.

For example: We live in a culture that devalues young girls who excel in math, leading to lower achievement in this area[1]. By the time they go to college they choose differently than men and "work in different industries"

[1] http://www.jstor.org/discover/10.2307/2096370?uid=3739856&ui... for one example

jami3• 13 years ago

At least 40% of the wage gap isn't explained by the factors you cite. http://www.americanprogress.org/issues/labor/news/2013/04/09...

khawkins• 13 years ago

I believe the interpretation is wrong here.

The hard data:

                         Employee Wages
                            F      M
 Has firstborn sons:      +0.8%  -0.5%
 Has firstborn daughters: +1.1%  +0.6%

The story here is that when men have children, in general, female employees wages go up, by pretty much the same amount. However, when the firstborn is a boy, they are harder on men, and a little more respectful of women.

I'd personally interpret this as men becoming more respectful of women when they witness their wives undergoing childbirth. However, the more drastic effect of child gender can be seen on male employee wages. I suppose the CEO might be channeling frustration in child-rearing a boy on his male employees.

bru• 13 years ago

I think that you have a very good point. The article should have been something like "Child Effect: When male CEO wife has a child, relative pay for women goes up".

More of a "My wife gave birth and that helped me gain respect/comprehension towards women" than a "I have a daughter and I'm realizing she'll grow up in biased world, time to fix that beside me".

Not that it is a better or worse conclusion, but quite different IMO.

draugadrotten3• 13 years ago

Can you see if the study rules out covariance with other factors such as "CEO becomes older, raises employee wages" or "CEO works fewer hours per week, raises employee wages".

dnautics• 13 years ago

Yeah, this definitely seems like "CEO has child, realizes children are expensive, so gives everyone a raise.... Unless it's a boy, in which case screw you, other guys".

mathattack• 13 years ago

This study was just Denmark, no?

It would be interesting to see if the data holds elsewhere.

samstave• 13 years ago

Cheney had a gay, female child... why is he still such a cold-hearted bastard?

jrockway• 13 years ago

Is he actually, or is that the persona of the character he plays on TV?

protomyth• 13 years ago

or the persona he was given by the coverage...

For example, President Ford was probably the most athletic President in the 1900's (he played LB). He is "known" more as clumsy and un-athletic from a set of comedy sketches[1].

1) the real lesson is shoe choice is important as a politician

jbooth2• 13 years ago

Given that, at this point, there's no incentive for him to be a bastard besides the pleasure derived from it, it seems like that's actually just who he is.

MartinCron• 13 years ago

It's all relative, imagine how much worse he would be if he only had straight male sons?

smacktoward• 13 years ago

In Cheney's defense, he is a robot sent back from the future to put humanity on the road to destruction. So it's not really fair to expect a lot of empathy from him.

rayiner14• 13 years ago

Cheney is a war-monger, but in his defense, he came out in favor of gay marriage in 2004, before a lot of democrats who are on board with it now that it's not as controversial.

clicks• 13 years ago

That might have something to do with his daughter Mary Cheney having come out as a lesbian way before 2004. In interviews before 2004 Cheney would often get asked about his daughter being gay and him being non-supportive of lgbt rights... and he'd just chide the interviewer for going there.

So really, it just shows what a terrible human being he is. He always played a position that was politically convenient... until it wasn't.

pessimizer• 13 years ago

Mary Cheney is a reactionary neocon chickenhawk just like dad. The only thing Cheney wasn't cold about was gay issues, probably because they applied to his own family.

imgabe• 13 years ago

Is there really a causal link here? They don't say anything about the size of the firms other than that they excluded very small firms. For medium to large size companies, how involved is the CEO in setting the salary for each employee?

peter-fogg2• 13 years ago

What's more, it seems that a small wage increase (say, for the next hire after a CEO's child is born) could have an outsize effect on average pay at the company.

schoper• 13 years ago

nature randomly determines the gender of each child

Some evidence emerging that this isn't true: http://www.sciencedaily.com/releases/2013/07/130710182941.ht...

People that tend to have more female babies: nurses. People that tend to have more male babies: CEOs.

Could low testosterone (or low "fitness," per article) in a CEO cause him to have more daughters? Could it also cause relative pay for women to go up in their company? Why would that be?

refurb• 13 years ago

When was the last time you saw the CEO of a company decide how much they pay their employees, especially in a huge Fortune 500 company?

Usually that's HRs job. Sure budgets are set high-up, but I think it's ridiculous to say that CEOs have a big impact in salaries.

dspeyer2• 13 years ago

From the article:

The researchers also found that these effects were strongest at firms with 50 or fewer employees, which they attribute to the fact that CEOs at smaller firms are typically more directly involved in making decisions that affect the pay of individual workers than CEOs at much larger firms.

tokenadult• 13 years ago

As with all preliminary research findings, this finding (reported here in a blog post from early 2011) needs replication before we can be sure it is reliable fact about the world.

http://norvig.com/experiment-design.html

As a father of three boys before I had my daughter, I really, truly desired to have a daughter in part to improve the "consciousness-raising" environment in my home both for myself and for my three boys. Perhaps I really have had a little bit of "male chauvinist pig" thinking on my own part counteracted by observing my daughter grow up at home. (My wife, on her part, grew up with four older brothers and only one (older) sister in her birth family, and she finds it very easy to take the male point of view.)

What exactly could be done about this from the public policy point of view? Family sizes are smaller than ever--which means that some CEOs have only daughters, and no sons, but other CEOs who have children have only sons, and will not go out of their way to have daughters just to balance their parenting experience. Other than differences in family structure, which thus far are usually haphazard more than planned, it's not completely clear what life experiences can be provided to the current generation of business leaders or the next generation of young people growing up to make sure that they have a balanced view (and what would that be?) about the roles of men and women in the society of the future.

bitops• 13 years ago

it's not completely clear what life experiences can be provided to the current generation of business leaders or the next generation of young people growing up to make sure that they have a balanced view (and what would that be?) about the roles of men and women in the society of the future.

One option could be to seek out education on the topic? I'm thinking of in-house seminars where speakers are invited to address the topic and provide coaching, particularly for executives. Of course, that assumes that the executives are interested and recognize the issue in the first place.

sentenza6• 13 years ago

It is horrifying to read the comments here. In Germany, where I live, on average, a woman will earn less than a man IF EVERYTHING ELSE IS THE SAME. Here is the source (PDF, in German):

https://www.destatis.de/DE/Publikationen/Thematisch/Verdiens...

No, this cannot be easily dismissed, yes they corrected for all the obvious stuff, no they don't have an agenda. This is a report by the official statistics bureau for Germany. Maybe the data for other countries is not as good, but why do so many people here immediately snap into backlash mode without considering the possibility that this could actually be an existing pay bias?

JabavuAdams2• 13 years ago

[...] why do so many people here immediately snap into backlash mode without considering the possibility that this could actually be an existing pay bias?

Because sexism and bigotry are properties of evil, despicable people, who aren't anything like us.

We're cool progressive techno-optimists. We're so smart we couldn't possibly be bigoted. We're the new establishment.

</sarcasm>

sentenza6• 13 years ago

I find it funny that you would read me like that.

Among my colleagues, I'm that one guy who, in his private life, is friends with "regular" people, who chooses to live in a rural area and who speaks with his native hillbilly accent.

I'm aware that everybody has biases and preconceptions. I was taught to be aware of mine, which I think I am (and boy, they're something). But nonetheless, the dismissive tone of (some parts of) the conversation disappointed me and I think, given the standards to which HN holds itself, rightfully so.

jsymolon• 13 years ago

Then why hire men at all? If women earn less over a greater period of time that may offset the benefit cost.

sentenza6• 13 years ago

Because children. My wife and I split the fourteen months of paternity leave between us and believe me, that stuff is rough. I can tell you from that experience, staying at home for a few months and then working while taking care of a small child changes your view on things and the view that others have of you. For one, you grow up to the point where you're not willing to accept all of the BS that work throws at you. Another thing is that you have "nothing to show" for a prolonged period of time and continue to underperform due to stress and lack of sleep.

Add to that the additional issues that women have due to the bodily changes they go through and you have a serious incentive to avoid hiring women. This is of course made worse by the implicit assumption that women usually do all the taking care of children, thus becoming even worse "performers" after having them.

On a side note: I was incredibly lucky to have a supportive employer that gave me the space necessary to take care of a child without getting completely derailed at work.

Guvante• 13 years ago

I agree with your point that people need to be careful to not dismiss the gender gap issue (which certainly exists for anyone over a certain age)

I have found on Reddit and here that the top comments are almost always against the original article if there is any way to view the conclusion differently.

I do not believe it is a systematic problem, it allows you to quickly get a hold of two conflicting viewpoints quickly.

I took the top comment to be "It is extremely difficult to mitigate factors when it comes to the gender gap, especially lost work time due to child care", he then quoted a study where a differential comparison saw at least one example of the opposite gender inequality.

Additionally the gender gap is rooted in cultural reasons, so comparing different countries is different. Specifically the existence of a certain gender gap in Germany does not mean such a gap exists in the US.

sentenza6• 13 years ago

You make good points. I second the last thing you brought up: Germany has one of the worst gender pay gaps in Europe, so that the situation in the US is most likely better than here, not worse.

However, I'd like to point out that my criticism was not aimed at the top comment but at many of the comments here in "the middle". What shocked me was not so much that people hold a view opposed to mine, but the dismissive tone of some posts.

Tichy5• 13 years ago

I live in Germany and tried to dig into the data a bit, and so far I am not convinced. It is very difficult to get precise data, for starters. I am simply sceptic about the "everything is the same" claim - in many cases, how many instances of women and men with the exact same job, qualification and work hours did they even find? For example they claim female software developers earn less on average, but in 13 years working as a software developer, I have encountered only very, very few female software developers. I am highly doubtful that it is even possible to create a meaningful statistic here. And there might be still more factors at work, such as willingness to relocate or preference for certain branches. If male software developers tend to work for car companies, banks or telcos and female software developers tend to work for ad agencies or create web sites for mom and pos's grocery store (just made up, I have no idea), it could make a difference for example. But as I said, it is very difficult to get that kind of data.

In the media I have seen worse offenses, for example the claim that female teachers earn less than male teachers, without mentioning that there are different kinds of schools (more women tend to work at elementary schools vs men working at high schools) - most teachers get a fixed salary determined by the government, so gender discrimination is next to impossible (there certainly is no government rule that female teachers earn less than male teachers). Or physicians, without mentioning that there are different branches of medicine and surgeons might have a harder job than pediatricians.

What strikes me is that none of those wage gap studies ever seems to question why the wage gap exists. For example they could ask employers or even the employees themselves. It seems they just want to prove discrimination and stop once they have favorable data.

s_baby4• 13 years ago

I agree with your point that people need to be careful to not dismiss the gender gap issue (which certainly exists for anyone over a certain age)

But why not be careful in blindingly accepting it? Alot of it is based on questionable application of statistics. Why not let the data speak for itself rather than providing creative interpretations?

For example, the early talking points were based on taking an average without even matching by job type. Ofcourse the part-time nanny doesn't earn as much as an overtime coal miner. That doesn't show a wage-gap.

jccooper• 13 years ago

"The study focused exclusively on male CEOs rather than female CEOs: men account for over 90 percent of the CEOs in the authors’ study and an even larger proportion of the CEOs of large companies around the world,..."

Fair enough; data set might be too small.

"while female CEOs would presumably already be attuned to possible gender wage inequity, consciously or not, by virtue of being women."

But this is not a reasonable conclusion. One hopes it's the reporter interpolating; otherwise the investigators have a rather rosy view of the world. Gender discrimination, to the extent it exists, seems to be rather strong in women as well.

They may be measuring a certain effect, but leaving out some interesting data.

dspeyer2• 13 years ago

I'd be very interested to see the mechanism. I can't imagine any company had a "pay women less" policy that got revoked. So what happened? Are women being brought into management more? It seems possible that a single promotion by the CEO could have major follow-on effects there. Had there been a subconscious tendency to shut down ideas that had women's names on them? Did the company culture move away from 60 hour weeks now that the CEO wants to get home early, allowing women (who are generally less willing to do 60 hours) to thrive?

I'm assuming the study conductors were competent statisticians, so there's a real effect and it pretty-much has to be causality as indicated.

sendos• 13 years ago

"Does that reflect an injustice? Many say no, arguing that women earn less because they take time off to care for children or elderly parents (and thus have less seniority) or accept lower pay in return for more flexible working arrangements. Women also tend to go into lower-paying lines of work, shunning higher-paying technical fields. It's easy to caricature this view (dirndls versus Visigoths, etc), but there may be some truth in it. Some research suggests that when women behave as men do--not having babies, mainly--the income gap largely disappears. If so (I won't claim the matter has been definitively settled), the question facing women is a stark one: What do you want, kids or cash?"

[1] http://www.straightdope.com/columns/read/2411/are-women-paid...

ChikkaChiChi• 13 years ago

Can any CEOs that intentionally pay women less where everything is equal chime in and explain why?

---

In my experiences, I believe women are brought in under equal pay but in small teams and companies they are relied on to handle more responsibilities; perhaps even sometimes being considered "senior" when they aren't promoted to that level.

I can't think of a single person who would be dumb enough to consider someone's genitalia when determining pay rate.

peter-fogg2• 13 years ago

Many forms of discrimination are much more subtle than "this candidate is a woman, so I'll offer her $10,000 less than a man". That's why the authors chose Denmark as an area of study; since the country is (apparently) a fairly egalitarian place, any explicit biases should have a small effect, and anything left over is unconscious discrimination.

koshatnik• 13 years ago

Interesting that having a daughter makes CEOs more mindful of equal pay, when they already had a woman close to them that they should be looking out for - their wife/partner (I'm assuming gay CEOs with kids don't form a significant percentage of the sample).

Is there any data on how CEOs and their partners share childcare responsibilities? I'd guess that most of the load is shouldered by their other half, given the kind of hours CEOs tend to work (especially in early stage companies).

Tichy5• 13 years ago

Might be worthwhile to point out that even if it should turn out to be true, this doesn't imply that male CEOs were paying their female employees unfairly before they had daughter. It would just show that they paid women more afterwards than before (which could be discriminating against men, for example). Perhaps they even just paid men less, or earned less themselves (perhaps daughters require more time spent with family or whatever), thus dragging down the averages. I have not read the actual PDF yet, though, only the newspaper summary.

When male CEOs have daughters, relative pay for women at their firms goes up

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