Brain Versus Brawn: The Realization of Women's Comparative Advantage

Michelle Rendall
2010 Social Science Research Network  
This paper estimates how much of the post-World War II evolution in employment and average wages by gender can be explained by a model where changing labor demand requirements are the driving force. I argue that a large fraction of the original female employment and wage gaps in mid-century, and the subsequent shrinking of both gaps, can be explained by labor reallocation from brawn-intensive to brain-intensive jobs favoring women's comparative advantage in brain over brawn. Thus, aggregate
more » ... er-specic employment and wage gap trends resulting from this labor reallocation are simulated in a general equilibrium model. This shift in production is able to explain: (1) about 79 percent of the rise in female labor force participation, (2) approximately 37 percent of the stagnation in the average female to male wage ratio from 1960 to 1980, and (3) about 83 percent of the closing wage gap between 1980 and 2005. In contrast, a counterfactual experiment, where agents cannot increase their innate brain abilities through education, fails to match the shape of the wage gap over time, resulting in a stagnant simulated wage gap from the 1960s onward. * I would like to thank, among others, Russell Cooper, Dean Corbae, Fatih Guvenen, Victor Rios-Rull, Kjetil Storesletten, and Fabrizio Zilibotti as well as seminar and conference participants at Brandeis University, Congressional Budget Oce, the
doi:10.2139/ssrn.1635251 fatcat:s2qofihv2zelbkxznft45fznyy