Does Comparable Worth Work in a Decentralized Labor Market?

51 Pages Posted: 30 Sep 2000 Last revised: 11 Mar 2022

See all articles by Michael Baker

Michael Baker

University of Toronto - Department of Economics; National Bureau of Economic Research (NBER)

Nicole M. Fortin

University of British Columbia (UBC) - Department of Economics

Date Written: October 2000

Abstract

We investigate the effect of pro-active comparable worth legislation covering both the public and private sectors on wages, the gender wage gap and the gender composition of employment. The focus is the pay equity initiative of the Canadian province of Ontario in the early 1990s. We document substantial lapses in compliance and problems with the implementation of the law among smaller firms where the majority of men and women work. This evidence provides important lessons of the obstacles to extending pay equity to the private sector of a decentralized labor market. When we focus on those sectors of the labor market where compliance was relatively strict, our results suggest that any positive effects on the wages of women in female jobs were very modest. Our most consistently estimated effects of the law on wages are negative: slower wage growth for women in male jobs and for men in female jobs.

Suggested Citation

Baker, Michael and Fortin, Nicole M., Does Comparable Worth Work in a Decentralized Labor Market? (October 2000). NBER Working Paper No. w7937, Available at SSRN: https://ssrn.com/abstract=244035

Michael Baker

University of Toronto - Department of Economics ( email )

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Nicole M. Fortin (Contact Author)

University of British Columbia (UBC) - Department of Economics ( email )

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