2019’s Economics Laureates on this year’s winner, Claudia Goldin

Claudia Goldin won this year’s Nobel Prize in Economics, the third woman to do so, and the third economic historian, after Simon Kuznets and his PhD student Bob Fogel, who in turn was Claudia’s PhD advisor. Her main work is on the history of women in the labour market. The focus is on the US, but there are obvious and important implications for India.It is easy to forget that a hundred years ago most women in the US did not work. While it is still true that women work less than men, the difference is not huge – 47% of the US labour force is female today. That number was closer to 25% in 1920. Essentially only unmarried women worked – the fraction of married women in the labour force was around 6%. What we learnt from Claudia’s research is that this was not always the case – in 1790, 60% of women worked, which was not very different from the corresponding rate for men (then, like now, those at the beginning of their adult life and those near the end didn’t work as much). It went down steeply in the 19th century and stayed down into the first quarter of the 20th century, and only started to go up in the 1930s.Claudia argues that the changing nature of the American economy over this period is behind this absence of linear progression. In the late 18th century, the main occupations were in agriculture and women worked, especially on the family farm, but also as hired labour. The work was never very far from home, and it was possible, if sometimes exhausting, to take care of the family while working.With the move away from agriculture towards manufacturing in the 19th century the jobs moved into the factory. Claudia suggests that this worked against women, who were portrayed as too delicate for the heavy and dirty work of the factories. The growth of office jobs mostly in the service sector, starting in the last years of the 19th century – jobs in banking, insurance, school-teaching and nursing, for example – eventually reversed this trend.However, as often with these moves to “protect” women from the harshness of the world, there was a strong element of sexism involved. Claudia emphasises the prevalent social norm that only women whose husbands could not support the family should work. Given the rising wages of male US workers in the 19th and early 20th centuries, this meant that it became harder and harder for married women to work outside their home without making their husbands feel inadequate. It is no accident that the turnaround takes place in the 1930s, when the Great Depression forces women to seek employment for sheer economic survival. The economy revives by the end of the 1930s, but starting in 1941, as American men go off to fight in World War II, the US government tries to reverse the hundred-year old stigma against women working in factories with, among other things, posters of the marvelously muscled mythical machinist, Rosie the Riveter. The impetus of that moment of liberation carries through the 1950s, and then merges into the broader social movements of the 1960s and after. Women’s labour force participation has stayed high since despite the occasional wobble.India in the 2020s is then not very different from the United States a hundred years before, in terms of the status of women’s work. While there are disputes about just how low the labour force participation rates are for women in India, since a lot of them work on family farms and in family businesses where their contributions often don’t get noticed or recorded, most estimates would put an upper bound of 25% on the fraction of labour force that is female, which is close to the US in 1920. And that fraction was probably falling till recently, again mirroring what happened in the US in the 19th century, and partly for the same reason, which is that men feel insecure when women become too economically independent.As many have noted this is an important brake on India’s aspiration to be a great economic power: a large and increasingly well-educated part of our potential labour force is not being used. The good news is that the norm eventually shifted in the US. Let’s only hope that it is not necessary to go through a Great Depression and a World War to get there.But shifting the norm is only half the battle. Claudia’s other important point is that to take full advantage of the many talents that women bring to the labour force we need other changes in the economic and social structures. Claudia has a beautiful piece of research showing evidence of discrimination against women: she showed that when a certain Symphony Orchestra went from auditions where the musicians could be observed, to blind auditions, women started to get more of the coveted positions. Even in this exceedingly rarified setting where the goal is supposedly to find the best, prejudice plays a major role.Despite that, she believes that the biggest thing preventing women from rising to the very top in today’s US, is less discrimination than the do-or-die nature of high-powered jobs. Women in the end, Claudia believes, give up opportunities because they would like to also have a life where they don’t worry about spending enough time with their children and other loved ones. The lack of availability of affordable high-quality childcare and elderly care in the US, even relative to most European countries, makes the challenge that much harder for younger women.In India these issues are not yet properly in the policy space – very little is being done by governments to bring women into the workplace. The obligations placed on married Indian women at home (between running the home and taking care of the children and the elderly) are so demanding that a regular job outside of the home is hard to manage. But unlike in the US a hundred years ago where women worked till they got married, even young unmarried women are missing in the Indian work scene, the combined result of parental paranoia and the very real lack of physical security in and outside the workplace. We hope that this prize, highlighting the forces that prevent women from working, will inspire an effort to change this. The writers are Professors at the Massachusetts Institute of Technology