The Economics of Equal Opportunities

Article excerpt

Humphries, Jane; Rubery, Jill (eds.). The economics of equal opportunities. Manchester, Equal Opportunities Commission, 1995. xx + 436 pp. Tables, figures, subject index, author index. ISBN 1-870358-47-3.

The economics of equal opportunities is a collection of papers resulting from a project sponsored by the Equal Opportunities Commission in the United Kingdom. The 17 contributions presented in the book are a response to the ambitious aim of reconciling the theory and practice of economics. The authors examine the contribution of different economic schools of thought and methodologies on the persistence of gender-based inequalities in the labour market, and the appropriateness of government policies to reduce these gaps. The empirical evidence presented concerns primarily the United Kingdom, but various contributions adopt a wider, comparative perspective and refer to data from other industrialized countries. The issues are examined from various angles, since the authors come from a range of disciplines within the social sciences.

The book starts with a critical review by the editors of how gender is treated in economic theory and analysis. The general thrust of the argument is that the pursuit of equity is not necessarily incompatible with economic efficiency. Humphries and Rubery support the view that costs and benefits of equal opportunities policies need to be understood and analysed in a broader context, i.e. at several different economic levels (macro and micro, dynamic and static, social and private) for the structure and distribution of gains and losses to be mapped out. For them, the efficiency cost conclusion is based on the unrealistic assumption that labour markets are competitive. In models which recognize the importance of social and economic institutions and various noncompetitive features, equal opportunities policies need not compromise efficiency.

Institutional structures are acknowledged as playing a crucial role in the persistence of unequal opportunities. The contributors look at three key areas in particular: (i) the acquisition of skills and access to employment with their links to the training and education systems; (ii) occupational segregation whose implications for the economics of equal opportunities flow through its interaction with industrial organization and systems of pay determination; and (iii) the sphere of social reproduction, i.e. maintenance of workers, rearing children and caring for the elderly. The division of responsibilities for social reproduction is reflected in complex inter-relationships between the State, households and the labour market.

The first chapters review different theoretical frameworks. Sawyer discusses the effects of equal opportunities policies on the economy from the perspective of neoclassical and eclectic approaches to labour market analysis. Humphries first contrasts the feminist and economist approaches; then reviews new institutionalist economics; and finally discusses discrimination and inequality of opportunity within the neo-classical economics framework. Paci, Joshi and Makepeace explore the role of labour market conditions in setting differential rates of pay for men and women. They look at pay differentials attributable to productivity-related personal characteristics (human capital model) and at those not accounted for by human capital characteristics (unequal treatment). Grimshaw and Rubery introduce a gender perspective to the analysis of internal labour markets. They survey efficiency wage models and analyse internal organizational legitimacy through pay and jobgrading structure, promotion and payment systems.

Two papers look at the costs and benefits of equal opportunities to employers. Holterman surveys the quantitative evidence available on the costs to employers of providing conditions of employment which make it easier to combine work and family responsibilities. In a broader context, Bruegel and Perrons examine how the costs of equal opportunities policies shift from some individuals to others (women and families, taxpayers, firms) under a variety of arrangements. …