The Nobel Memorial Prize in Economics for this year has been awarded to American Claudia Goldin of Harvard University for her work in explaining changes in women’s earnings and participation in the labor market. Dr. Goldin examined more than 200 years of data (much of it gathered through painstaking sleuthing through obscure sources) to identify the causes of changes and the primary forces behind the lingering gender pay gap.
Each year, the Royal Swedish Academy of Sciences awards the Prize (formally the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel) in recognition of ideas and research that increase our understanding of important issues in economics and related areas. Although most people are not interested in the pure economics of such efforts, the discoveries often shape public policy or even the way we think about the world which, in turn, affects the daily lives of virtually everyone.
Dr. Goldin’s analysis illuminates a complex subject. She explains how the proportion of women working decreased during the Industrial Revolution but then began to increase with the emergence of the services sector. Social norms were changing over time, and more women entered the workforce. She further found that, throughout much of history, women made critical career decisions at an early age that often modeled the behavior of prior generations, thus perpetuating limited labor force participation. Fortunately, that tendency has greatly diminished in recent times.
