Principles of Economics, 7th Edition

Published by South-Western College
ISBN 10: 128516587X
ISBN 13: 978-1-28516-587-5

Chapter 19 - Part VI - Earnings and Discrimination - Problems and Applications - Page 411: 8

Answer

Greenspan's behavior was profit-maximizing. However, some people might say that his behavior was despicable. In his own words, Greenspan said that he 'always valued men and women equally'. If he did value men and women equally, he should have paid women as much as men.

Work Step by Step

If more employers were like Greenspan, the demand for female economists would increase. In turn, the wages paid to female economists would increase. The increased wages would decrease the wage differential between male economists and female economists. Other economic consultants would likely not have followed Greenspan's economic strategy since there might not have been as many female economists as the market would have allowed (to meet the equilibrium).
Update this answer!

You can help us out by revising, improving and updating this answer.

Update this answer

After you claim an answer you’ll have 24 hours to send in a draft. An editor will review the submission and either publish your submission or provide feedback.