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The award of the Nobel Prize in Economics to Harvard economist Claudia Goldin is appropriate as her research has given important insights about the persistent gender gap in the labour market and may help to address issues relating to women in the workplace. Economics has the reputation of being a dismal science, but her work has helped to humanise economic theory and showed how it can be of use to solve problems of inequality, discrimination and injustice based on gender. She is the third woman to win the Nobel economics prize and the first to win it on the basis of her own work rather than as a collaborator in research with others. The Nobel jury said that her work provided “the first comprehensive account of women’s earnings and labour market participation through the centuries’’ and that “she has advanced our understanding of women’s labour market outcomes”.
Goldin used more than 200 years of US data to show that differences in educational and occupational choices have historically influenced the pay gap between men and women and the reasons for the imbalance continue to be valid. She studied the role of women in the farm, the industrial economy, and the service sector, and showed that there was no direct and positive correlation between economic growth at the macro level and the number of women in paid employment. Female participation in the labour market did not have an upward trend over the period under study but instead formed a U-shaped curve. Higher educational levels and the contraceptive pill were important factors that facilitated greater labour participation of women, but they have never got their due place. Globally, only half of all women are in paid employment, compared to 80% of men. They earn less than men, and are less likely to reach top positions.
Goldin found that the bulk of the earnings difference is now between men and women in the same occupation, and that it largely arises with the birth of the first child. She also found that flexible working hours would help to improve women’s employment. The situation in different societies may differ in degrees, but the overall nature and trends of women’s employment remain largely the same. Goldin’s research has given better tools to understand the issues. It is particularly important for India where women’s participation in the labour force is very low. India’s labour scene is changing with many people moving out of farms, women’s education improving and new labour practices and work culture coming into vogue. Greater women’s participation will boost the economy. But that is not the only consideration. Women’s place in the job market is one of the big social justice issues in the country now.