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gender inequality and simple rules: the case of ellen pao and reddit

One of my arguments about inequality is that we should focus on simple rules that have an immediate positive effect. Granted, these are hard to find. When we do find them, they should command our attention. For example, many scholars of gender and work have found that women often lose out when negotiating. The solution? Ban salary negotiations. In other words, people should compete for jobs, but the jobs are relatively stable in terms of compensation. We shouldn’t allow our possibly unconscious (or even conscious!) views towards others to allow some people to get more for doing the same work.

Turns out that one CEO is following the “simple rules against inequality” philosophy – Ellen Pao of Reddit. From a recent Yahoo article:

In an interview with the Wall Street Journal published Monday, Pao says she decided to rewrite the rules of hiring at Reddit. In addition to hiring workplace diversity consultant Freada Kapor Klein, the company no longer allows new hires to negotiate their salaries. Pao defended her move based on studies that have shown that when women negotiate, they don’t fare as well as their male counterparts.

“We’ve got a lot of diversity on our team,” she told Yahoo’s Katie Couric in a separate interview. “We could use more, but we’re very excited to make sure we have different perspectives that represent the people we have using the site.” 

Although Pao doesn’t name specific research, there have been plenty of studies to back up her claims. One 2006 study led by Carnegie Mellon University professor Linda Babcock revealed that when women negotiate, both men and women are less likely to want to work with them. Men, on the other hand, are much more respected for their negotiation skills. For women, it’s generally a lose-lose situation. In another study published in 2014, researchers found that female negotiators are perceived as more easily misled than male negotiators and are more likely than men to be lied to in negotiations.

One can easily imagine similar rules implemented in other workplaces. For example, if universities are worried that female scientists aren’t being promoted at similar rates, they could require automatic review instead of allowing promotion reviews to be optional or initiated by faculty.

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Written by fabiorojas

June 3, 2015 at 12:06 am

4 Responses

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  1. Well sure, I totally believe that reduces inequality. But doesn’t it also reduce the welfare of employees overall by decreasing the proportion of the worker’s output captured by the employee? I.e. doesn’t everyone end up worse off in absolute terms?

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    Brad Spahn

    June 3, 2015 at 7:19 am

  2. Speaking of gender inequality, I wonder what Fabio’s opinion is of the recent article in The Economist on the gender inequalities for men ( http://www.economist.com/news/leaders/21652323-blue-collar-men-rich-countries-are-trouble-they-must-learn-adapt-weaker-sex ) especially given Diprete’s recent book “The Rise of Women”.

    Are there “simple rules that have an immediate positive effect” in this domain when it comes to inequality?

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    LKT

    June 3, 2015 at 4:21 pm

  3. @brad spahn: unclear, Brad. Depends on what your model of negotiation and salary is. Show me yours and I’ll show you mine.

    @LKT: Are there “simple rules” for working class men? That’s an empirical question, but I’d support rules that help with gender inequality in any context, including those where men are at disadvantage.

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    fabiorojas

    June 3, 2015 at 4:53 pm

  4. Fabio, you make a good point. If there’s a hard rule against negotiating, companies will offer more so that they don’t lose good employees.

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    Brad Spahn

    June 4, 2015 at 5:53 am


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