Hostname: page-component-745bb68f8f-b6zl4 Total loading time: 0 Render date: 2025-01-14T00:24:28.319Z Has data issue: false hasContentIssue false
  • English
  • Français

Sexual orientation–based wage gaps in Australia: The potential role of discrimination and personality

Published online by Cambridge University Press:  01 January 2023

Andrea La Nauze
Andrea La Nauze*
Affiliation:
University of Melbourne, Australia
*
Andrea La Nauze, Department of Economics, University of Melbourne, 111 Barry St, Carlton, VIC 3053, Australia. Email: ala1@unimelb.edu.au; andrea.lanauze@gmail.com
Get access Rights & Permissions [Opens in a new window]

Abstract

This article reports a research finding that lesbians in Australia earn an unexplained wage premium of 0%–13%, whereas gay men experience an unexplained negative wage gap of 8%–18%. Based on data from the Australian household panel Household Income and Labour Dynamics in Australia, the article is the first to establish these gaps in Australia, and to examine the degree to which credence can be afforded to claims that endowments such as personality traits may help explain such wage differentials. Using ordinary least squares and Blinder–Oaxaca decomposition methods, the study explicitly includes the battery of Big Five personality traits in wage regressions and estimates the contribution of endowments and returns to these traits. The finding is that personality traits and returns to them do not differ along lines of sexual orientation. Gay men in particular suffer a substantial unexplained wage penalty in the workplace. Such unexplained differences suggest that discrimination on the basis of sexual orientation, though unlawful, may exist in Australia.

Keywords

J15J71Discriminationpersonalitysexual orientationwage decompositionwage determinationwage gaps
Type
Articles
Information
The Economic and Labour Relations Review , Volume 26 , Issue 1 , March 2015 , pp. 60 - 81
Copyright
Copyright © The Author(s) 2015

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Ahmed, AM, Hammarstedt, M (2010) Sexual orientation and earnings: a register data-based approach to identify homosexuals. Journal of Population Economics 23: 835–849.CrossRefGoogle Scholar
Allegretto, SA, Arthur, MM (2001) An empirical analysis of homosexual/heterosexual male earnings differentials: unmarried and unequal? Industrial and Labor Relations Review 54(3): 658–686.CrossRefGoogle Scholar
Antecol, H, Jong, A, Steinberger, M (2007) The sexual orientation wage gap: the role of occupational sorting, and human capital? Industrial and Labor Relations Review 61: 518.CrossRefGoogle Scholar
Arabsheibani, GR, Marin, A, Wadsworth, J (2005) Gay pay in the UK. Economica 72(286): 333–347.CrossRefGoogle Scholar
Arulampalam, W, Booth, AL, Bryan, ML (2007) Is there a glass ceiling over Europe? Exploring the gender pay gap across the wage distribution. Industrial and Labor Relations Review 60(2): 163–186.CrossRefGoogle Scholar
Australian Bureau of Statistics (ABS) (2013) Australian social trends. Cat no. 4102.0, July. Canberra, ACT, Australia: ABS.Google Scholar
Badgett, L (1995) The wage effects of sexual orientation discrimination. Industrial and Labor Relations Review 48(4): 726–739.CrossRefGoogle Scholar
Badgett, L (2006) Discrimination Based on Sexual Orientation: A Review of the Literature in Economics and beyond. Northampton, MA: Edward Elgar, pp. 116–186.Google Scholar
Becker, GS (1971) The Economics of Discrimination. Chicago, IL: University of Chicago Press.CrossRefGoogle Scholar
Becker, GS (1981) A Treatise on the Family. Cambridge, MA: Harvard University Press.Google Scholar
Berg, N, Lien, D (2002) Measuring the effect of sexual orientation on income: evidence of discrimination? Contemporary Economic Policy 20(4): 394–414.CrossRefGoogle Scholar
Bertrand, M, Duflo, E, Mullainathan, S (2004) How much should we trust difference-in-differences estimates? Quarterly Journal of Economics 19(1): 249–275.CrossRefGoogle Scholar
Black, DA, Makar, HR, Sanders, SG, et al. (2003) The earnings effects of sexual orientation. Industrial and Labor Relations Review 56(3): 449–469.CrossRefGoogle Scholar
Blashill, AJ, Powlishta, KK (2009) The impact of sexual orientation and gender role on evaluations of men. Psychology of Men and Masculinity 10(2): 160–173.CrossRefGoogle Scholar
Blinder, AS (1973) Wage discrimination: reduced form and structural estimates. Journal of Human Resources 8(4): 436–455.CrossRefGoogle Scholar
Bowles, S, Gintis, H, Osborne, M (2001) Incentive-enhancing preferences: personality, behavior, and earnings. The American Economic Review 91(2): 155–158.CrossRefGoogle Scholar
Carpenter, CS (2008) Sexual orientation, work, and income in Canada. Canadian Journal of Economics 41(4): 1239–1261.CrossRefGoogle Scholar
Clarke, G, Sevak, P (2013) The disappearing gay income penalty. Economics Letters 121(3): 542–545.CrossRefGoogle Scholar
Cobb-Clark, DA, Schurer, S (2012) The stability of big-five personality traits. Economics Letters 115(1): 11–15.CrossRefGoogle Scholar
Elmslie, B, Tebaldi, E (2007) Sexual orientation and labor market discrimination. Journal of Labor Research 28(3): 436–453.CrossRefGoogle Scholar
Fortin, N, Lemieux, T, Firpo, S (2010) Decomposition methods in economics. Technical report working paper no. 16045, June. Cambridge, MA: National Bureau of Economic Research.CrossRefGoogle Scholar
Haisken-DeNew, JP, Hahn, M (2010) Panelwhiz: efficient data extraction of complex panel data sets an example using the German SOEP. Journal of Applied Social Science Studies 130(4): 643–654.Google Scholar
Jann, B (2008) The Blinder-Oaxaca decomposition for linear regression models. Stata Journal 8(4): 453–479.CrossRefGoogle Scholar
Kite, ME, Deaux, K (1987) Gender belief systems: homosexuality and the implicit inversion theory. Psychology of Women Quarterly 11(1): 83–96.CrossRefGoogle Scholar
Klawitter, MM, Flatt, V (1998) The effects of state and local anti-discrimination policies on earnings for gays and lesbians. Journal of Policy Analysis and Management 17(4): 658–686.3.0.CO;2-P>CrossRefGoogle Scholar
Madon, S (1997) What do people believe about gay males? A study of stereotype content and strength. Sex Roles 37(9): 663–685.CrossRefGoogle Scholar
Mueller, G, Plug, E (2006) Estimating the effect of personality on male and female earnings. Industrial and Labor Relations Review 60(1): 3–22.CrossRefGoogle Scholar
Nyhus, EK, Pons, E (2005) The effects of personality on earnings. Journal of Economic Psychology 26(3): 363–384.CrossRefGoogle Scholar
Nyhus, EK, Pons, E (2012) Personality and the gender wage gap. Applied Economics 44(1): 105–118.CrossRefGoogle Scholar
Oaxaca, R (1973) Male-female wage differentials in urban labor markets. International Economic Review 14(3): 693–709.CrossRefGoogle Scholar
Organisation for Economic Cooperation and Development (OECD) (2012) Consumer prices (MEI). Available at: http://stats.oecd.org/Index.aspx?DatasetCode=MEI_PRICES (accessed 29 May 2012).Google Scholar
Plug, E, Berkhout, PH (2004) Effects of sexual preferences on earnings in the Netherlands. Journal of Population Economics 17(1): 117–131.CrossRefGoogle Scholar
Plug, E, Berkhout, PH (2008) Sexual orientation, disclosure and earnings. Report, Institute for the Study of Labor (IZA) discussion paper no. 3290, January. Bonn: IZA.CrossRefGoogle Scholar
Summerfield, M, Freidin, S, Hahn, (2013) HILDA User Manual Release 12. p. 51. Available at: https://www.melbourneinstitute.com/downloads/hilda/User%20Manual/HILDA_User_Manual_Release_12.2.pdf (accessed 22 July 2014).Google Scholar
Supplementary material: File

La Nauze supplementary material
Download undefined(File)
File 375.2 KB