## Marianne Bertrand: Inequity Detective ## Source details **Canonical URL:** [Marianne Bertrand: Inequity Detective](https://www.imf.org/en/publications/fandd/issues/2022/03/inequity-detective-bertrand) ## Other formats - [Markdown version](/en/publications/fandd/issues/2022/03/inequity-detective-bertrand/index.md) - [Structured JSON version](/en/publications/fandd/issues/2022/03/inequity-detective-bertrand/index.json) - [Bundle manifest](/en/publications/fandd/issues/2022/03/inequity-detective-bertrand/bundle-manifest.json) ## Bibliographic details - Authors: PRAKASH LOUNGANI - Published: March 1, 2022 --- ### Profile and career milestones - Author/profile: Prakash Loungani; F&D Magazine; March 2022. - Education and appointments: - PhD from Harvard in 1998. - Started career at Princeton; moved in 2000 to Chicago’s Booth School of Business, where she has remained. - Awards and honors: - Prize in 2004 for “outstanding contributions by young women” in economics. - Prize in 2012 for “outstanding contributions to the field of labor economics.” - Selected in 2020 to give the Ely Lecture at the annual meetings of the American Economic Association (AEA). ### Landmark research on racial discrimination - 2004 audit study (with Sendhil Mullainathan): - Sent nearly 5,000 fictitious resumes in response to job ads in Boston and Chicago. - Found that Black-sounding names, such as Lakisha, were 50 percent less likely to get a callback than white-sounding names, such as Emily, with resumes alike in qualifications. - Interpreted as difficult to attribute to anything other than explicit prejudice or unconscious bias. - Real-world resonance: - Study invoked in contemporary anecdotes of housing appraisal manipulation highlighting racial bias. ### Gender inequity, motherhood, and labor outcomes - Core findings: - “Mothers take a massive earnings hit right after that first birth, and their income never recovers.” - Careers of college-educated women track those of their husbands until the birth of the first child; declines thereafter. - Women graduates of top MBA programs tend to cut back hours and interrupt careers on becoming mothers. - Mechanisms emphasized: - Childbearing and childcare as “more potent yet prosaic” explanations for gender gaps. - Women disproportionately responsible for home and childcare tasks, making it harder to meet inflexible schedules in higher-paying occupations. - Evidence on representation in finance (from IMF-related research cited): - Women accounted for fewer than 5 percent of CEOs at financial institutions. - Women made up less than 25 percent of the representation on bank boards. - Social cost: - Bertrand: “Women are not born with a comparative advantage in changing diapers, so it follows that we must be leaving some money on the table by having only 5 percent of Fortune 500 companies run by women.” ### Social norms, household dynamics, and pace of progress - Progress acknowledged: - Ely Lecture stressed “good news” that gender gaps in education and labor force participation are on the decline, especially in the developed world. - Norms studied: - Norm that men should earn more than their wives; sharp drop-off in percentage of US households where the wife earns more once she makes over half the family income. - Households where the woman earns more show “compensating behavior” by the wife to take on more household chores; such households were more prone to marital strife and divorce. - Advice to younger women (commencement remarks): “if you want to have it all, make sure to check your date’s willingness for diaper duty and to let you shine as the brightest star at work.” ### CEO pay, “skimming,” and corporate governance - Trends and magnitudes: - In the United States today, the average CEO makes 350 times the average worker, compared with a 20-to-1 ratio that prevailed in 1965. - Key findings (with Mullainathan and other work): - CEO compensation increases with factors outside a CEO’s control (e.g., oil prices, exchange rates), implying pay driven in part by luck. - Conclusion from the paper: “CEO pay is as sensitive to a lucky dollar as to a general dollar.” - “Skimming” view: when corporate governance is weak, CEOs can set their own pay with little oversight; skimming is less prevalent in better-governed firms with large shareholders able to limit CEO capture. - Broader implications: - Bertrand links pay structures and short-termism to firms’ neglect of social purpose, while noting potential trade-offs between financial return and social impact: “some people out there are really willing to leave money on the table if they think they can have a [social] impact.” ### Shifts in economics: interdisciplinarity and equity - Disciplinary change: - From “an imperial science” to greater embrace of other social sciences; Bertrand: “to put it humbly, economists have realized their mistakes and now embrace, rather than dismiss, the other social sciences.” - Equity and efficiency: - Challenges the view that focusing on distribution undermines sound economics; argues that “inequality also hurts efficiency.” - Cites Booth colleague Chang-Tai Hsieh’s finding that lowering barriers to entry for women and African Americans accounted for a quarter of US growth. - Policy lens: - Advocates assessing economic policies holistically: even if a trade policy passes aggregate cost-benefit tests, concentrated losses (e.g., shutting down 80 percent of manufacturing plants in some communities) require balancing equity concerns. - Welcomes international financial institutions like the IMF embracing the balance between efficiency and equity: “it’s a no-brainer, really.” - Institutional engagement: - Notes IMF work on Inclusive Growth and Structural Policies that guides how policy advice can better balance efficiency and equity. *Source: Prakash Loungani, F&D Magazine, March 2022 — “Marianne Bertrand: Inequity Detective.”* --- ## Content in this bundle - **شخصيات اقتصادية** - [شخصيات اقتصادية (Markdown version)](/-/media/files/publications/fandd/article/2022/march/ar/people.pdf.md){rel="alternate" type="text/markdown"} - [شخصيات اقتصادية (PDF)](/-/media/files/publications/fandd/article/2022/march/ar/people.pdf){rel="external" type="application/pdf"} - **La traqueuse d’injustices** - [La traqueuse d’injustices (Markdown version)](/-/media/files/publications/fandd/article/2022/march/fr/people.pdf.md){rel="alternate" type="text/markdown"} - [La traqueuse d’injustices (PDF)](/-/media/files/publications/fandd/article/2022/march/fr/people.pdf){rel="external" type="application/pdf"} - **Inequity Detective** - [Inequity Detective (Markdown version)](/-/media/files/publications/fandd/article/2022/march/pie.pdf.md){rel="alternate" type="text/markdown"} - [Inequity Detective (PDF)](/-/media/files/publications/fandd/article/2022/march/pie.pdf){rel="external" type="application/pdf"} - **pie** - [pie (Markdown version)](/-/media/files/publications/fandd/article/2022/march/ru/pie.pdf.md){rel="alternate" type="text/markdown"} - [pie (PDF)](/-/media/files/publications/fandd/article/2022/march/ru/pie.pdf){rel="external" type="application/pdf"} - **Detective de la desigualdad ● Finanzas y Desarrollo ● Marzo de 2022** - [Detective de la desigualdad ● Finanzas y Desarrollo ● Marzo de 2022 (Markdown version)](/-/media/files/publications/fandd/article/2022/march/sp/people.pdf.md){rel="alternate" type="text/markdown"} - [Detective de la desigualdad ● Finanzas y Desarrollo ● Marzo de 2022 (PDF)](/-/media/files/publications/fandd/article/2022/march/sp/people.pdf){rel="external" type="application/pdf"} - **不平等现象的侦探** - [不平等现象的侦探 (Markdown version)](/-/media/files/publications/fandd/article/2022/march/zh/loungani-pie.pdf.md){rel="alternate" type="text/markdown"} - [不平等现象的侦探 (PDF)](/-/media/files/publications/fandd/article/2022/march/zh/loungani-pie.pdf){rel="external" type="application/pdf"} --- _Source: https://www.imf.org/en/publications/fandd/issues/2022/03/inequity-detective-bertrand_