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Sexual orientation–based wage gaps in Australia: The potential role of discrimination and personality

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  • Andrea La Nauze

Abstract

This article reports a research finding that lesbians in Australia earn an unexplained wage premium of 0%–13%, whereas gay men experience an unexplained negative wage gap of 8%–18%. Based on data from the Australian household panel Household Income and Labour Dynamics in Australia, the article is the first to establish these gaps in Australia, and to examine the degree to which credence can be afforded to claims that endowments such as personality traits may help explain such wage differentials. Using ordinary least squares and Blinder–Oaxaca decomposition methods, the study explicitly includes the battery of Big Five personality traits in wage regressions and estimates the contribution of endowments and returns to these traits. The finding is that personality traits and returns to them do not differ along lines of sexual orientation. Gay men in particular suffer a substantial unexplained wage penalty in the workplace. Such unexplained differences suggest that discrimination on the basis of sexual orientation, though unlawful, may exist in Australia.

Suggested Citation

  • Andrea La Nauze, 2015. "Sexual orientation–based wage gaps in Australia: The potential role of discrimination and personality," The Economic and Labour Relations Review, , vol. 26(1), pages 60-81, March.
    • Handle: RePEc:sae:ecolab:v:26:y:2015:i:1:p:60-81
    DOI: 10.1177/1035304615570806
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    References listed on IDEAS

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    Cited by:

    1. Sabia, Joseph J. & Wooden, Mark, 2015. "Sexual Identity, Earnings, and Labour Market Dynamics: New Evidence from Longitudinal Data in Australia," IZA Discussion Papers 8935, Institute of Labor Economics (IZA).
    2. Deborah A. Cobb‐Clark & Lihini De Silva, 2021. "Participation, Unemployment, and Wages," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 54(4), pages 482-493, December.
    3. Drydakis, Nick, 2021. "The Economics of Being LGBT. A Review: 2015-2020," GLO Discussion Paper Series 980, Global Labor Organization (GLO).
    4. John Levendis & Aaron Lowen, 2023. "What Same-Sex Adoption Laws Can Tell Us About the Gender Wage Gap in the United States," Journal of Family and Economic Issues, Springer, vol. 44(2), pages 473-489, June.
    5. Nick Drydakis, 2022. "Sexual orientation and earnings: a meta-analysis 2012–2020," Journal of Population Economics, Springer;European Society for Population Economics, vol. 35(2), pages 409-440, April.

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    More about this item

    Keywords

    Discrimination; personality; sexual orientation; wage decomposition; wage determination; wage gaps;
    All these keywords.

    JEL classification:

    • J15 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Minorities, Races, Indigenous Peoples, and Immigrants; Non-labor Discrimination
    • J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing

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