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Equal Pay: If Women Earn Less, Should They Should Pay Less?

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Equal Pay: If Women Earn Less, Should They Should Pay Less?

For the week 7 mission of Prosperity’s Kitchen’s marketing competition, I re-wrote my Custom Analysis & Coaching service page, and I added a new wrinkle to the price: women will pay 77% less than men.

What do you think?

Equal pay between men and women has been in the news a lot recently, including being mentioned by President Obama during his second inaugural address: “[O]ur journey is not complete until our wives, our mothers and daughters can earn a living equal to their efforts.”

The wikipedia entry for Equal Pay for Women gives a good overview of the issue. Women are paid less than men in almost every country, and in the United States the pay gap is 77%. (Female full-time, year-round workers earn 77% of what male full-time, year-round workers earn.)

But why are women paid less? Is it discrimination (gender stereotypes or customer and employer bias) or differences in personal and workplace characteristics between men and women (education levels, hours worked, chosen occupation, or whether they choose to negotiate salary)?

Studies estimate that between 5% – 7% of the pay gap between men and women in the US is due to discrimination, which the following studies illustrate:

  • When orchestras moved to blind auditions, more women received jobs.
  • Identical resumes with female names received fewer replies than if they had male names.
  • White male doctors were rated as more approachable and competent than equally well performing women or minority doctors. The authors of the study suggest that employers are willing to pay more for white male employees because employers are customer driven and customers are happier with white male employees.
  • Customers who viewed videos featuring a black male, a white female, or a white male actor playing the role of an employee helping a customer were 19% more satisfied with the white male employee’s performance and also were more satisfied with the store’s cleanliness and appearance. This despite that all three actors performed identically, read the same script, and were in exactly the same location with identical camera angles and lighting. Moreover, 45 percent of the customers were women and 41 percent were non-white, indicating that even women and minority customers prefer white men.

These studies indicate that there is a bias against women and minorities in the United States, which is a contributing factor in the equal pay issue between men and women.

Salary Negotiators’ mission is to help people improve their standard of living by teaching them how to be better negotiators. Women, for whatever reason, negotiate less often than men. Offering women a lower price is a way to incentivize them to get in the game and eliminate the pay gap, one person at a time.

What do you think? Should women pay 77% less than men because they make less? Should they pay 5% – 7% less (the portion of pay gap attributable to discrimination)?

I’m interested to hear your thoughts in the comment section!

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About the Author:

Joseph Richards is the founder of Salary Negotiators. He is a Labor Economist and Salary Negotiation consultant. Google+ Facebook Twitter

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