Comparable Worth

Human Capital and Comparable Worth

Human capital theory posits that the difference between male and female wages relate to varying levels of education, training, experience, and so on. From the neoclassical perspective, for comparable worth to be operating, economists must ensure that the wage differences between jobs are not explained by human capital differences. The problem is that economists believe that not all human capital is measurable; therefore, it is assumed that some of the wage differences are due to unmeasured human capital and discrimination is not the main reason for such differences in compensation between women and men. This would render comparable worth policies useless in repairing the gender wage gap.

Compensating Differentials and Comparable Worth

Some jobs have disamenities that others do not. These jobs may be dangerous or unfavorable to the majority of the population. Consequently, according to this theory, these jobs are paid at a higher wage than other jobs. For example, construction and secretarial work may take similar amounts of education and training, but construction is viewed as a dangerous job, and according to compensating differentials, wages should be higher for that type of work. From this perspective, male-dominated careers are more likely to have disamenities, which is why they result in higher wages than female-dominated jobs. Human capital economists claim that the gender wage gap reflects real differences in types of jobs rather than direct discrimination; hence, comparable worth would not solve the gap.

...