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The equal pay act as an experiment to test theories of the labour market

Manning, Alan (1993) The equal pay act as an experiment to test theories of the labour market. CEP discussion paper, 153. Centre for Economic Performance, London School of Economics and Political Science, London, UK.

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Abstract

The UK Equal Pay Act of 1970 resulted in a large rise in the relative earnings of women in the early 1970s. As this change (unlike most wage changes) was largely exogenous to employers one can think of this episode as an experiment for testing different theories of the labour market. Hence, study of the effects of the Equal Pay Act should be given considerable weight and is likely to have wider implications about the operation of labour markets. Most models of the labour market used by economists assume that employment is demand-determined at least after a large positive shock to the wage. The models would predict that female relative employment should have fallen after the introduction of the Equal Pay Act. Yet, it is hard to find evidence of this. This paper argues that female employment did not fall because the female labour market is, in part monopsonistic.

Item Type: Monograph (Discussion Paper)
Official URL: http://cep.lse.ac.uk
Additional Information: © 1993 Alan Manning
Library of Congress subject classification: H Social Sciences > HD Industries. Land use. Labor
Sets: Collections > Economists Online
Research centres and groups > Centre for Economic Performance (CEP)
Departments > Economics
Rights: http://www.lse.ac.uk/library/usingTheLibrary/academicSupport/OA/depositYourResearch.aspx
Identification Number: 153
Date Deposited: 19 Aug 2008 13:09
URL: http://eprints.lse.ac.uk/20956/

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