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Wesleyan Economic Working Papers http://repec.wesleyan.edu/ No: 2012-006 Closing the Gender Gap: What Would It Take? Joyce P. Jacobsen January, 2012 Department of Economics Public Affairs
Wesleyan Economic Working Papers http://repec.wesleyan.edu/ No: 2012-006 Closing the Gender Gap: What Would It Take? Joyce P. Jacobsen January, 2012 Department of Economics Public Affairs Center 238 Church Street Middletown, CT 06459-007 Tel: (860) 685-2340 Fax: (860) 685-2301 http://www.wesleyan.edu/econ Closing the Gender Gap: What Would It Take? Draft of January 19, 2012 Joyce P. Jacobsen The economic turning point for humankind was the 19th century, marking the start of Industrial Revolution, during which time growth rates in material well-being began rising steadily for the first time in human history thanks to a prolonged period (continuing through the present time) of technological change and increased productivity. But the economic turning point for women did not come until the last quarter of the 20th century, when they experienced greatly improved material well-being relative to men. However, women continue to have less access to and less control of productive resources than do men. This fundamental inequality is true across time and place. Thus women make lower earnings on average than do men, are more likely to be poor than are men, and are less likely to be wealthy than are men. What would it take to change these patterns? This chapter outlines the main dimensions of differences in women's and men's economic well-being and considers the potential causes of these differences. After delineating the causes, it will become clearer what would have to change in order for women to achieve significantly greater economic well-being relative to men. In conclusion, we will consider whether such changes are possible in the foreseeable future. Dimensions of Difference Economic differences between individuals relate to differences in access to and control over productive factors, such as skills, machinery, land, and social networks. Even though individual access varies widely, in general, men have more access to and control over productive factors than do women. These differences in access and control then manifest themselves in different outcomes on dimensions of well-being. Economic well-being is generally measured by the amount of earnings (income from labor) or total income (income from all productive sources, including returns from holdings of capital and land) that a person or household has in a year. There are also differences in wealth holdings, the monetary value of the stock of productive resources that a person or household controls, though these tend to be harder to measure on an individual basis. While this chapter mainly focuses on contemporary US data as examples of gender differences, the direction (though not the identical magnitude) of gender differences is the same for other societies, both contemporary and past. Women have always and everywhere been economically disadvantaged relative to men. However, men also have systematic disadvantages relative to women on many dimensions, as we shall see below. Differences in income, wealth, and poverty While women still earn less than men, the difference has shrunk considerably since the 1970s, both in the US and abroad. Figure 1 shows for 1947-2010 the median annual income ratio (women to men) for workers in the US. The median annual income is the amount of income that half those working make more than, and half make less, and is a commonly-used measure of group income. The figure shows this ratio for three groups: all workers; year-round full-time workers; and young year-round full-time workers (ages 25 through 34). The differences in these three ratios (with each group in turn showing a smaller earnings gap) demonstrate both that women tend to work fewer total hours than men (thus for all workers the gap is both in terms of different hours worked and less earnings per hour) and that income gaps tend to widen for older workers (but are still occurring even among younger workers). While Figure 1 displays annual income rather than annual earnings, for most persons who are in the workforce, earnings is the main source of income, and thus this measure can be taken as an indicator of differences in earnings as well. In all three series, the same pattern appears: a downturn in the years following World War II (indicating some backsliding in women's progress towards higher incomes during this period), followed by a long period of only incremental increase through the 1960s and 1970s, followed by a period of sustained rise from the 1980s. The series for all workers shows the most sustained continued increase as women have steadily increased their labor force participation relative to men, while the earnings for the higher-working groups show more flattening-out in the most recent years. All figures are shown on the final three pages of the chapter.
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