The impact of gender, ethnicity and other forms of discrimination on wages, levels and types of employment
Discrimination based on gender or ethnicity can push down wages for affected groups. It can also reduce how many people from those groups get hired, and trap them in lower-paid types of work.
Formula
Gender Pay Gap (%) = ((Male median wage − Female median wage) / Male median wage) × 100
Real World
In 2023, the BBC's gender pay gap reporting revealed male presenters were still paid significantly more than female counterparts in equivalent roles, demonstrating occupational discrimination depressing women's wages below their MRP.
Exam Focus
Distinguish between the pay gap (different wages for same work) and the earnings gap (different occupational distribution) — conflating them loses marks.
Price Elasticity of Demand
PED = % change in quantity demanded ÷ % change in price
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