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Fairness and Wages in Mexico's Maquiladora Industry: An Empirical Analysis of Labor Demand and the Gender Wage Gap

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  • Aurelie Charles

Abstract

In 2001, China's entry into the World Trade Organization (WTO) and the US recession put pressure on maquiladora workers' wages. The result was an increase in the gender wage gap. At the firm level, this increase is not discriminatory, in the sense that the lower income entitlement for women is socially accepted at the household level. This paper uses Akerlof and Yellen's (1990) fair wage-effort hypothesis to explain the gender wage gap as a matter of “fair-wage constraints” that differ across genders, which are, in turn, due to evolving social norms of fairness in reservation wages for men and women within households. Empirical evidence for changes in gender wages gaps across industries between 1997 and 2006 is found to be consistent with this argument.

Suggested Citation

  • Aurelie Charles, 2011. "Fairness and Wages in Mexico's Maquiladora Industry: An Empirical Analysis of Labor Demand and the Gender Wage Gap," Review of Social Economy, Taylor & Francis Journals, vol. 69(1), pages 1-28.
    • Handle: RePEc:taf:rsocec:v:69:y:2011:i:1:p:1-28
    DOI: 10.1080/00346760903480558
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    Citations

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    Cited by:

    1. Vassil, Kristjan & Eamets, Raul & Mõtsmees, Pille, 2014. "Socio-demographic Model of Gender Gap in Expected and Actual Wages in Estonia," IZA Discussion Papers 8604, Institute of Labor Economics (IZA).
    2. Narula, Rajneesh & Van der Straaten, Khadija, 2019. "A comment on the multifaceted relationship between multinational enterprises and within-country inequality," MERIT Working Papers 2019-035, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    3. Suk-Kyu Kim & Yunduk Jeong, 2021. "Developing the Healthy and Competitive Organization in the Sports Environment: Focused on the Relationships between Organizational Justice, Empowerment and Job Performance," IJERPH, MDPI, vol. 18(17), pages 1-15, August.
    4. Wilfred Dolfsma & Deborah Figart & Robert McMaster & Martha Starr, 2012. "Promoting Research on Intersections of Economics, Ethics, and Social Values: Editorial," Review of Social Economy, Taylor & Francis Journals, vol. 70(2), pages 155-163, June.
    5. Michael Carr & Aurelie Charles & Wilfred Dolfsma & Robert McMaster & Tonia Warnecke, 2015. "Effective Contributions to the Review of Social Economy and Social Economics—Editorial," Review of Social Economy, Taylor & Francis Journals, vol. 73(2), pages 139-145, June.

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