To what extent is there a place for rational choice, represented by the human capital theory, in explaining modern occupational segregation of gender.

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To what extent is there a place for rational choice, represented by the human capital theory, in explaining modern occupational segregation of gender?

Occupation sex segregation was first used by Gross (1968, in RESKIN 1993), to describe women’s and men’s concentration into different occupations. Although there have been dramatic gains in female participation in the labour force, segregation has remained a universal and enduring aspects of labour markets around the world (England, 1982). The difference in occupations and earnings has been documented empirically in numerous studies. Reskin (1993) demonstrates that out of every hundred women about 57 would have to switch to predominantly male employment for the distribution of sexes to be equal across detailed occupations. These patterns of segregation have left women concentrated into particular sectors of the economy, resulting in unequal outcomes and opportunities and representing reasons to be concerned. This is far more than physical separation, “it is a fundamental process in societal inequality” (Reskin, 1993). As a result of these detrimental consequences this phenomenon has received an abundance of often contradictory theoretical explanations. Rational choice represents the supply side of these explanations and forms an extremely influential and popular theory in understanding the occupational sex segregation in the labour force. Indeed, economics has become defined around a paradigm of rational choice (England, 2003). Despite its value some economists are critical of the narrow economistic conception of this theory, although to widen it perpetuates the risk of making it tautologically useless (Blackburn et.al 1999). Thus this essay will focus primarily on the rational choice represented through the Human capital theory (HCT). The effects of this theory have been studied extensively in recent years, but despite its intuitive appeal many have agreed it lacks empirical support, questioning some of the principle assumptions of the theory. Combined with a ‘glut of explanations’ (England 1984) surrounding occupational segregation there has been a decline in enthusiasm for this approach, but with the absence of suitable replacements the theory still remains a powerful explanatory tool. The aim of this essay is to critically evaluate the explanatory power of rational choice in offering an account of occupational sex segregation.

The HCT theory views the individual as being rational actors whom are able to make decision about their investments in things that will bring about changes in their own capital (Becker, 1962). Accordingly jobs with higher status and pay are a direct reward for personal investment (Becker 1962); it follows that man’s greater pay relative to women is related fundamentally to human capital. In its simplest form, HCT identifies a number of assumptions which account for this. Firstly, women, by virtue of spending time in domestic work and child rearing are prevented from investing in human capital. This is combined with the demographic generalisation that the average age of marriage is 30.6yrs for men and 28.4yrs for women (UK, 2001 census) which equate to longer time in the labour market and thus greater accumulation of human capital for the husband relative to the wife. This is formed into an explanation of occupational segregation as the difference in wage makes it economically rational to prioritize the employment of the higher wage earner (the male), while the women take responsibility for household work. Furthermore, this is self self-reproducing (Blackburn et.al 2002) as the relative differences in pay between the sexes  is increased it equated to greater prioritisation. This arrangement is logically sound and mutually beneficial for both partners, assuming they stay together in the long term. However, this does not form a complete account of occupational segregation as it is unable to explain the observable employment differences between single members of society.

Polachek (1981) extends the theory to incorporate intermittent labour force participation and aims to describe how ration choice-human capital explanations can be applied to society as a whole. His theory is based on the assumption that women choose employment in order to maximise life-time earnings. He argues that due to women’s unpaid labour demands, women’s participation in the labour force will be more discontinuous than male participation. Their absence from employment will result in skill ‘depreciation’, which is simultaneously combined with forgone appreciation of human capital by virtue of being unable to accrue on the job training (England 1982). It is therefore economically rational for women who plan to spend more time away from the labour market to choose occupations with lower penalties of human capital while absence, so, upon return they maintain a lower wage drop (Anker 1997).  Polachek finds evidence (using occupational categories) that employees taking time out the labour force have larger wage drops in male dominated occupations than female dominated occupations. Many other work has lent its support the HCTs assumptions. Waite and Berryman (1985 in Okamoto et al, 1999) demonstrated that those who expect continuous employment aspire to employment in less traditionally female occupations, Bridges (1989) found that men and women rate occupational values differently, this includes the ease of re-entering jobs after child rearing.

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As a result of the empirical support, Polachek places great confidence in his theory, stating that “differences in labour force commitment alone account for much of the difference in professional and menial employment. If women were to have full commitment to the labour force, the number of women professionals would increase by 35 percent”. He concludes, “such results (although viewed as measure of potential change) illustrate that life cycle labour choice participation patterns are related to rational career choices” (Polachek, 1981). Thus he argues rational choice-HCT is able to provide a ‘powerful explanation’ for the difference in earnings and occupational ...

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