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Compensating Differentials for Sexual Harassment

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  • Joni Hersch

Abstract

Workplace sexual harassment is illegal, but many workers report that they have been sexually harassed. Exposure to the risk of sexual harassment may decrease productivity, which would reduce wages. Alternatively, workers may receive a compensating differential for exposure to sexual harassment, which would increase wages. Data on claims of sexual harassment filed with the Equal Employment Opportunity Commission are used to calculate the first measures of sexual harassment risks by industry, age group, and sex. Female workers face far higher sexual harassment risks. On balance, workers receive a compensating wage differential for exposure to the risk of sexual harassment.

Suggested Citation

  • Joni Hersch, 2011. "Compensating Differentials for Sexual Harassment," American Economic Review, American Economic Association, vol. 101(3), pages 630-634, May.
    • Handle: RePEc:aea:aecrev:v:101:y:2011:i:3:p:630-34
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    File URL: http://www.aeaweb.org/articles.php?doi=10.1257/aer.101.3.630
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    References listed on IDEAS

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    1. Kaushik Basu, 2003. "The Economics and Law of Sexual Harassment in the Workplace," Journal of Economic Perspectives, American Economic Association, vol. 17(3), pages 141-157, Summer.
    2. Antecol, Heather & Cobb-Clark, Deborah, 2006. "The sexual harassment of female active-duty personnel: Effects on job satisfaction and intentions to remain in the military," Journal of Economic Behavior & Organization, Elsevier, vol. 61(1), pages 55-80, September.
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    Cited by:

    1. Finlay, Jocelyn E., 2021. "Women’s reproductive health and economic activity: A narrative review," World Development, Elsevier, vol. 139(C).
    2. Joni Hersch, 2018. "Valuing the risk of workplace sexual harassment," Journal of Risk and Uncertainty, Springer, vol. 57(2), pages 111-131, October.
    3. Shiu-Yik Au & Ming Dong & Andréanne Tremblay, 2024. "How Much Does Workplace Sexual Harassment Hurt Firm Value?," Journal of Business Ethics, Springer, vol. 190(4), pages 861-883, April.
    4. Gordon B. Dahl & Matthew Knepper, 2026. "Why Is Workplace Sexual Harassment Underreported? The Value of Outside Options amid the Threat of Retaliation," American Economic Review, American Economic Association, vol. 116(3), pages 897-933, March.
    5. Bac, Mehmet, 2018. "Wages, performance and harassment," Journal of Economic Behavior & Organization, Elsevier, vol. 145(C), pages 232-248.
    6. Chen, Haoning & Dong, Miaomiao & Henry, Marc & Sidorov, Ivan, 2025. "Occupational segregation in a Roy model with composition preferences," Games and Economic Behavior, Elsevier, vol. 150(C), pages 365-386.
    7. Abi Adams-Prassl & Kristiina Huttunen & Emily Nix & Ning Zhang, 2024. "Violence against Women at Work," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 139(2), pages 937-991.
    8. Giulia Zacchia & Izaskun Zuazu, 2023. "The Wage Effect of Workplace Sexual Harassment: Evidence for Women in Europe," Working Papers Series inetwp205, Institute for New Economic Thinking.
    9. Azmat, Ghazala & Boring, Anne, 2020. "Gender Diversity in Firms," IZA Policy Papers 168, Institute of Labor Economics (IZA).
    10. Chen, Daniel L. & Sethi, Jasmin, 2016. "Insiders, Outsiders, and Involuntary Unemployment: Sexual Harrassment Exacerbates Gender Inequality," IAST Working Papers 16-44, Institute for Advanced Study in Toulouse (IAST).
    11. Boring, Anne & Delfgaauw, Josse, 2024. "Social desirability bias in attitudes towards sexism and DEI policies in the workplace," Journal of Economic Behavior & Organization, Elsevier, vol. 225(C), pages 465-482.
    12. Haoning Chen & Miaomiao Dong & Marc Henry & Ivan Sidorov, 2020. "Occupational segregation in a Roy model with composition preferences," Papers 2012.04485, arXiv.org, revised Sep 2024.
    13. Bell, Alex, 2020. "Job Amenities & Earnings Inequality," MPRA Paper 118516, University Library of Munich, Germany.
    14. Jason Sockin, 2022. "Show Me the Amenity: Are Higher-Paying Firms Better All Around?," CESifo Working Paper Series 9842, CESifo.
    15. Lauren A. Rhodes & Gonzalo E. Sánchez & Nereyda Espinoza-Velasteguí & Viviana Borja, 2025. "Assessing the gap between social and individual perceptions of sexual harassment," International Review of Economics, Springer;Happiness Economics and Interpersonal Relations (HEIRS), vol. 72(2), pages 1-19, December.
    16. Lauren A. Rhodes & Gonzalo E. Sánchez & Nereyda E. Espinoza & Viviana Borja, 2024. "The role of social norms on the willingness to act and donate against sexual harassment," International Review of Economics, Springer;Happiness Economics and Interpersonal Relations (HEIRS), vol. 71(2), pages 257-271, June.
    17. Cyprien Batut & Caroline Coly & Sarah Schneider-Strawczynski, 2021. "It's a man's world: culture of abuse, #MeToo and worker flows," Working Papers halshs-03403513, HAL.
    18. Karl David Boulware & Kenneth N. Kuttner, 2018. "Labor market conditions and charges of discrimination: Is there a link?," Wesleyan Economics Working Papers 2018-007, Wesleyan University, Department of Economics.
    19. Ratul Das Chaudhury & Birendra Rai & Liang Choon Wang & Dyuti Banerjee, 2021. "Welfare v. Consent: On the Optimal Penalty for Harassment," Papers 2103.00734, arXiv.org, revised Apr 2023.

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