The case for pay discrimination (trust me, it'll be interesting)

in pay •  3 years ago  (edited)

I realize this sounds scandalous. You would never consider it. Am I bigoted? Am I a horrible person? Of course not. There actually is a case for pay discrimination, and I think you might agree with me if you give it some consideration.

We always hear stories of women being paid less for the same work as men. The gender pay gap is approximately 80 cents in the US, according to unofficial and official sources. Certainly the gap is there, but the underlying insinuation is that the difference is a result of sexism and bigotry. Of course I dispute this claim. My main reason is that employers and business are all profit seeking. If it were possible to pay women, who are equally competent and perform the same work as men, less than men, the male unemployment rate would be astronomical. Why would an employer pay a man more money to do the same amount of work? The business would certainly gain more profits by hiring all women. But better explains the gap is lifestyle choices, but that's another story. I am here to make the case that pay discrimination is actually desirable. Let me explain why.

Assume there is an employer who is the incarnation of all the worst assumptions from generally the political left. He is bigoted, racist, sexist, homophobic, and he dislikes apple pie (how dare he). We'll call him Bob. Bob will pay men more than women, straight people more than gay people, white people more than black people, and tall people more than short people. Regardless of competence and work efficiency, certain groups of people will receive more pay.

Now Bob runs a business, and his business has competitors in the same town. To satisfy his bigotry, Bob pays his male employees $20/h and his female employees $15/h, even though his female employees are just as good as his male ones. This is unfair to his female employees! Someone should do something! Absolutely. Something has actually been done. Bob is bigoted against women, and he should have to pay for it. He is paying for it. He pays the difference in wages between his male and female employees, multiplied by the number of male employees. That extra $5/h he pays his male employees, he could have kept it as profit for himself. He could have hired more women, or he could have lowered the pay for males down to $15/h, but he chose to be bigoted. In effect, Bob is being taxed for his sexism. Eventually, if Bob does not get rid of his unfair treatment, he will go out of business. Bob's competitors will have no problem hiring more women than men, or paying men than same as women. His competitors will have a lower cost basis and a higher profit than Bob. Ultimately, his competitors will outcompete Bob. Bob must change, or loss his business. Bigotry is not good business practice, and the free market will work to eliminate it.

See, wasn't it at least a little interesting? I admit that this concept is not mine. I heard it from a lecture given by Milton Friedman.
Milton was a Nobel Prize winning economist from the Chicago school of economics. His ideas have brought sense into a sometimes a senseless world. He has inspired many people who later also achieved great acclaim, Thomas Sowell, for example. Another story for another time :)

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