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IPFS News Link • Employee and Employer Relations

#39- "Free Markets Exploit Women"

• http://fee.org, by ANNE RATHBONE BRADLEY

Followed by this assertion is the conclusion that capitalism exacerbates the gender-wage gap and exploits women. As Curly, one of the Three Stooges, said in a famous skit, "I resemble that remark!"  

As a female economist in a male-dominated field, I am sympathetic to these concerns and most certainly know that while no markets are perfect, freed markets have done the best to help women increase their skills, education and overall comparative advantage as well as to allow them a space to offer their skills in the service of others.

How does this happen and what's the evidence? 

Let's start with the mechanics of how freed labor markets offer the best opportunities for women to prosper. The first necessary condition is equality before the law. In a world where women are not equal before the law and are not allowed to even show up for certain types or sectors of employment, the supply of labor is constrained. There are simply fewer people available to offer their labor when we eliminate half of the potential workforce. This has extremely negative and culturally-discriminatory effects and it also thwarts economic freedom. Firms aren't as productive as they could be. It took hundreds of years for this to be established in the United States. In many countries women are still not equal and often held hostage under the law. For example, in Saudi Arabia it is illegal for women to drive and all women are required to have a male guardian, thus making work and employment costly and difficult. It is no accident that without equality before the law, Saudi Arabia ranks 127th of 136 in gender-wage parity.


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