Sex Discrimination and Women's Labor Market Outcomes
The human capital explanation of sex differences in wages is that, owing to specialization in household production, women intend to work in the labor market more intermittently than men, and therefore invest less, leading to lower wage growth. An alternative "feedback" hypothesis is that women experience labor market discrimination and respond with career interruptions, less investment, and lower wage growth. This paper explores the relationship between self-reported discrimination and subsequent labor market outcomes to test this alternative hypothesis. Some of the evidence is consistent with the feedback hypothesis. Working women who report discrimination are more likely subsequently to change employers, to have children, and to marry. However, the evidence is not consistent with the two implications of the feedback hypothesis that most directly challenge the human capital explanation of sex differences in wages; women who report discrimination do not accumulate less experience, nor do they have lower wage growth.
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