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Differences Do Not Matter: Exploring the Wage Gap for Same-Sex Behaving Men

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  • Michael E Martell

    (Department of Economics, American University, 4400 Massachusetts Avenue NW, Washington DC 200016, USA.)

Abstract

An emerging literature provides evidence that same-sex behaving men earn significantly less than different-sex behaving men. I corroborate these existing findings and explore the source of these earnings differentials. I show that differences in worker characteristics between same-sex behaving men and different-sex behaving workers cannot explain the significant wage differential that same-sex behaving men experience. Wage differentials for same-sex behaving men are surprising because sexual orientation is not a visible trait. It seems as though same-sex behaving men might use a strategy of “passing” to avoid discrimination. I develop a model of worker-firm interaction that incorporates passing. I show the existence of an equilibrium in which wage differentials reflect a compensating differential, where same-sex behaving workers accept lower wages in exchange for being able to reveal their sexual orientation within a tolerant firm. In this equilibrium, competition will not erode earnings differentials as traditional models of discrimination suggest.

Suggested Citation

  • Michael E Martell, 2013. "Differences Do Not Matter: Exploring the Wage Gap for Same-Sex Behaving Men," Eastern Economic Journal, Palgrave Macmillan;Eastern Economic Association, vol. 39(1), pages 45-71.
    • Handle: RePEc:pal:easeco:v:39:y:2013:i:1:p:45-71
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    Citations

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    Cited by:

    1. Alex Bryson, 2017. "Pay equity after the Equality Act 2010: does sexual orientation still matter?," Work, Employment & Society, British Sociological Association, vol. 31(3), pages 483-500, June.
    2. Clarke, Geoffrey & Sevak, Purvi, 2013. "The disappearing gay income penalty," Economics Letters, Elsevier, vol. 121(3), pages 542-545.
    3. Mary Eschelbach Hansen & Michael E. Martell, 2014. "Self-Identified Sexual Orientation and the Lesbian Earnings Differential," Working Papers 2014-13, American University, Department of Economics.
    4. Michael E. Martell & Leanne Roncolato, 2020. "Share of Household Earnings and Time Use of Women in Same-Sex and Different-Sex Households," Eastern Economic Journal, Palgrave Macmillan;Eastern Economic Association, vol. 46(3), pages 414-437, June.
    5. Michael E. Martell & Leanne Roncolato, 2023. "Economic Vulnerability of Sexual Minorities: Evidence from the US Household Pulse Survey," Population Research and Policy Review, Springer;Southern Demographic Association (SDA), vol. 42(2), pages 1-74, April.
    6. Nick Drydakis, 2022. "Sexual orientation and earnings: a meta-analysis 2012–2020," Journal of Population Economics, Springer;European Society for Population Economics, vol. 35(2), pages 409-440, April.
    7. Stephan Humpert, 2012. "Somewhere over the Rainbow: Sexual Orientation Discrimination in Germany," Working Paper Series in Economics 245, University of Lüneburg, Institute of Economics.
    8. Mary Eschelbach Hansen & Michael E. Martell & Leanne Roncolato, 2020. "A labor of love: The impact of same-sex marriage on labor supply," Review of Economics of the Household, Springer, vol. 18(2), pages 265-283, June.
    9. Marina Mileo Gorsuch, 2019. "Gender, Sexual Orientation, and Behavioral Norms in the Labor Market," ILR Review, Cornell University, ILR School, vol. 72(4), pages 927-954, August.
    10. Ian Burn & Michael E. Martell, 2022. "Gender typicality and sexual minority labour market differentials," British Journal of Industrial Relations, London School of Economics, vol. 60(4), pages 784-814, December.
    11. Marieka Klawitter, 2015. "Meta-Analysis of the Effects of Sexual Orientation on Earnings," Industrial Relations: A Journal of Economy and Society, Wiley Blackwell, vol. 54(1), pages 4-32, January.

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