Gender Economics: Why do women earn less than men and what can we do about it? (2018)


Women earn less than men, in Germany and all other countries of the world. The so-called gender wage gap (also: gender pay gap), the average gap between the gross hourly wage of men and women, amounts to about 21 percent in Germany. Different explanations have been put forward to explain this gap. For instance, it can be shown that part of the gap is explained by women choosing jobs that pay lower wages. Moreover, women take career breaks much more often and for longer time spans to take care of kids and family. These career breaks are another reason why women are paid on average lower wages than men. But even when we control for such individual characteristics like education, work experience, job choice, working hours etc., unexplained residual remains, a wage gap that cannot be traced back to individual differences in these variables.