Birželio 16 d. Lietuvos laisvosios rinkos instituto prezidentas dr. Remigijus Šimašius vedė 22-osios tarptautinės Europos moterų vadybos vystymo tinklo konferencijos "Kūrybiškumas, įvairovė ir galia" pirmąją dalį ir skaitė pranešimą "Skirtumai, diskriminacija ir nepanaudotos galimybės rinkoje".

Pristatome pranešimo tezes anglų k.

The goal of this presentation is to describe a theoretical economic framework of the analysis of discrimination and also to take a look at the example of the situation of the woman in the labour market.

Being all equal, people are different according to skills and abilities, qualification, interests, age, … and sex.

We do not expect from people not to pay attention to these differences: when we raise our children, we tell them and explain to them what and why is different, what is acceptable and what is not, what is good and what is bad.

When you read old books and find the term “discriminatory”, it means not just discrimination as most people understand it today. For example, discriminatory taste means ability and practice of choosing one sort of things instead of another (for example, good music instead of bad one, good food instead of bad one).

Speaking about definitions: differentiation is first of all the ability to identify differences, discrimination is ability and practice of acting and choosing between different possibilities. Choice implies discrimination because in order to choose we have to have options (which by definition are different) and when we choose we decide to pick up one option instead of another.

Discrimination may be justified or not, however, the problem of criteria of justification arises. We feel by intuition that some sort of discrimination is fine, but some sort is unacceptable at all.

The solution to this problem is not to find and classify on what grounds discrimination can be justified (for example, abilities) and on what grounds it becomes unjustified (for example, sex). The solution lies in distinguishing between discrimination made by public authorities and by private people.

Discrimination by public authorities (both “usual” discrimination and affirmative action) is usually unacceptable as a government has a duty to treat all people equally. This is, of course, not a solution in all cases either as government authorities do act and have to discriminate. This means that we nevertheless have to enter into public debate about discrimination in the public sector.

Discrimination by private people (especially in the market) is more complicated because in order to abolish discrimination we by definition discriminate those who discriminate.

Market is always discrimination, because consumers discriminate sellers all on grounds of price and quality first of all.

However unreasonable discrimination in the market is not a viable strategy for the following reason. (Of course, which discrimination is “reasonable” is to be decided by decisions and the selection of consumers and other actors in the market as well).

If you, for example, discriminate women as employees, it means that you have to hire men to take up the same position. If other employers act in the same way, it means that the demand for men employees is much higher than the demand for women employees. This difference in demand is inevitably reflected in price – salary in this case. This means that hiring a man is more expensive than hiring a woman. This leads to the fact that those companies which discriminate women incur higher costs and will be out of the market competed by those which do not discriminate.

From the point of view of practical implications, if there is a tradition to discriminate women, it gives a new opportunity to new businesses that do not discriminate women. If you identify unreasonable discrimination – you just go to the market and grab this opportunity of entering the market with lower costs.

As we know from economic theory, markets are striving towards equilibrium. This means that opportunities are being used and there is no discrimination of significant importance in the market. Of course, it does not mean that there is no discrimination in the market caused by government intervention. This kind of discrimination, however, is not a private discrimination any more.

The question remains why women in most Western labour markets tend to earn, on average, about 25 percent less than men. There may be a number of explanations. I will not enter in many possible speculations and research on it but will just present one example of extreme importance. Women give labour, not men, and also tend to have a break in their careers in order to raise children. Such brakes surely affect both the proposed position in the labour market, qualification of the employee, and even the choice of profession (women tend to choose professions where leaving of the labour market is more possible, and this pushes down the price of tasks performed by such professionals).

In conclusion. Discrimination as such in the private sector is neither good nor bad, but may be reasonable or not. If women are unreasonably discriminated in the market, this opens new opportunities for women, as at the end consumers usually discriminate only on the ground of price and quality. However, if you see the difference, it does not necessarily mean unreasonable discrimination.

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Differences, discrimination, and open opportunities in the market