WGST 2P86 Lecture : WISE 2P86 2011 Spring Chapter 7
11 Feb 2012
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Document Summary
Two important rationales for government intervention to combat discrimination: to increase efficiency and reduce inequity. Exists when two equally qualified individuals are treated differently solely on the basis of their gender, race, age, disability, etc. In the absence of discrimination, profit maximizing employers in a competitive labour market pay workers in accordance with their productivity. One view: inequality occurs because women are paid less than their marginal product. Another view: discrimination directly lowers women"s productivity as well as their pay, because they could be denied training programs. Or when customers are reluctant to patronize a female salesperson. If discrimination lowers the returns to such human capital investments, women are less likely to undertake them. This is the indirect or feedback effect of discrimination. Labour market discrimination may adversely affect women"s own decisions and behaviour. Much of the research on discrimination has focused on the direct effects: on pay or occupational differences between equally well-qualified men and women.
