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The Sexual Orientation Wage Gap: The Role of Occupational Sorting, Human Capital, and Discrimination

Author

Listed:
  • Antecol, Heather

    (Claremont McKenna College)

  • Jong, Anneke

    (affiliation not available)

  • Steinberger, Michael D.

    (Pomona College)

Abstract

Using data from the 2000 U.S. Census, we document and explore three alternative explanations for the sexual orientation wage gap: occupational sorting, human capital differences, and discrimination. We find lesbian women earn more than their heterosexual counterparts irrespective of marital status while gay men earn less than their married heterosexual counterparts but more than their cohabitating heterosexual counterparts. Using a Oaxaca-Blinder decomposition we find that differences in human capital accumulation (particularly education) are the main reason behind the observed wage advantages, while discrimination and occupational sorting play a minimal role at best. Wage penalties, on the other hand, are largely explained by discrimination. Interestingly, while we do find there are some differences in the relative roles of our three alternative explanations across the wage distribution using a DiNardo, Fortin, Lemieux decomposition, the main conclusions from the Oaxaca-Blinder decomposition persist.

Suggested Citation

  • Antecol, Heather & Jong, Anneke & Steinberger, Michael D., 2007. "The Sexual Orientation Wage Gap: The Role of Occupational Sorting, Human Capital, and Discrimination," IZA Discussion Papers 2945, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp2945
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    Cited by:

    1. Noah Uhrig, S.C., 2014. "An examination of poverty and sexual orientation in the UK," ISER Working Paper Series 2014-02, Institute for Social and Economic Research.
    2. Thierry Laurent & Ferhat Mihoubi, 2012. "Sexual Orientation and Wage Discrimination in France: The Hidden Side of the Rainbow," Journal of Labor Research, Springer, vol. 33(4), pages 487-527, December.
    3. Juan D. Barón & Deborah A. Cobb‐Clark, 2010. "Occupational Segregation and the Gender Wage Gap in Private‐ and Public‐Sector Employment: A Distributional Analysis," The Economic Record, The Economic Society of Australia, vol. 86(273), pages 227-246, June.
    4. Andrea La Nauze, 2015. "Sexual orientation–based wage gaps in Australia: The potential role of discrimination and personality," The Economic and Labour Relations Review, , vol. 26(1), pages 60-81, March.
    5. Sarzosa, Miguel, 2023. "Sexual Orientation and Labor Market Disparities," Journal of Economic Behavior & Organization, Elsevier, vol. 212(C), pages 723-755.
    6. Michael E. Martell, 2014. "HOW ENDAs EXTEND THE WORKWEEK: LEGAL PROTECTION AND THE LABOR SUPPLY OF BEHAVIORALLY GAY MEN," Contemporary Economic Policy, Western Economic Association International, vol. 32(3), pages 560-577, July.

    More about this item

    Keywords

    human capital; occupational sorting; sexual orientation wage gap; discrimination;
    All these keywords.

    JEL classification:

    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing

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