Gender discrimination and firms’ profit: evidence from Brazil

Purpose This paper investigates discrimination against women within the Brazilian labour market using firm-level data from the World Bank Investment Climate Survey. The purpose of this paper is to determine whether the female employees in the Brazilian labour market are paid less than their producti...

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Bibliographic Details
Published in:Journal of economic studies (Bradford) 2016-01, Vol.43 (5), p.801-814
Main Authors: Liu, Wenjun, Nomura, Tomokazu, Nishijima, Shoji
Format: Article
Language:English
Subjects:
Bias
Developing countries
Economic analysis
Economic growth
Economic models
Education
Educational attainment
Female employees
Females
Gender
Gender differences
Gender equity
Hypotheses
Income distribution
Inequality
Labor market
LDCs
Productivity
Profitability
Profits
Race
Segregation
Sex discrimination
Society
Wage differential
Wages & salaries
Women
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Summary:Purpose This paper investigates discrimination against women within the Brazilian labour market using firm-level data from the World Bank Investment Climate Survey. The purpose of this paper is to determine whether the female employees in the Brazilian labour market are paid less than their productivity warrants due to the existence of discrimination. Design/methodology/approach Based on employer discrimination model proposed by Becker (1971) that considered the proportion of female employees as a proxy for the extent of discrimination, the authors estimate the profit function using OLS analysis, and regress it on the proportion of female employees and other firm characteristics. To address the endogeneity problem caused by unobservable productivity shocks, the authors employed the methods proposed by Olley and Pakes (1996) and Levinsohn and Petrin (2003), respectively. Findings The results indicate that the proportion of female employees has positive effect on firms’ profit in 2002, but has no effect in 2007. This finding gives evidence of the existence of discrimination against female employees within the Brazilian labour market in the early 2000s, while the gender discrimination was reduced overtime. Originality/value This paper’s main contribution is to provide an approach that differs from that of previous research to determine whether discrimination exists within the Brazilian labour market. This paper also provides policy insights for Brazilian labour market.
ISSN:0144-3585
1758-7387
DOI:10.1108/JES-06-2014-0093