Claudia Goldin: Women, Work and the Pay Gap

How Claudia Goldin used centuries of data to explain women's changing role in the labour market and why a pay gap persists, winning the 2023 Nobel prize.

In 2023, Claudia Goldin won the Nobel prize, alone, “for having advanced our understanding of women’s labour market outcomes”. She was the third woman to win the economics prize and the first to win it unshared.

A historian of work

Goldin gathered data covering 200 years of American history, from censuses, company records and other sources. Her work revealed patterns that simple assumptions missed.

The U-shaped curve

Women’s work outside the home didn’t simply rise over time. Goldin found a U-shape:

In agricultural economies, women worked a lot on family farms and in home businesses.
As economies industrialised, many married women left paid work, partly due to social norms and the nature of factory work.
Later, with the growth of services, education and white-collar jobs, women’s participation rose again.

This pattern also helps explain trends in countries like India, where women’s participation has been low.

The pill and careers

Goldin and Lawrence Katz showed that access to the contraceptive pill in the US from the 1960s let women delay marriage and childbirth, invest in education and pursue careers like law and medicine.

Why the pay gap persists

Goldin found that the modern pay gap arises largely after the birth of the first child. The reason, she argued, is “greedy jobs”: jobs that pay disproportionately more for long, inflexible hours. Couples often decide that one partner, usually the woman, takes a more flexible, lower-paid role to handle family responsibilities.

This means the gap is less about discrimination at the same job and more about how work is structured.

Solutions

Goldin suggests making high-paying jobs more flexible, so that working fewer or more predictable hours doesn’t carry a large penalty. She points to fields like pharmacy, where work became more substitutable and the pay gap narrowed.

The two lawyers

A couple are both lawyers. After their first child, the firm expects someone to be available at all hours. One partner takes a job with predictable hours and lower pay; the other stays on the high-pressure track. Their incomes diverge, even though they started equal.

Thinking the pay gap is mainly unequal pay for identical work

Goldin found much of the gap reflects how jobs reward long, inflexible hours, especially after children arrive.

Key takeaways

Goldin won the 2023 Nobel prize for research on women's labour markets.
Women's participation follows a U-shape as economies develop.
The contraceptive pill helped women invest in careers.
Greedy jobs that reward long hours explain much of the modern pay gap.