Absence of conflict of interest.
Citation
Sinha, S. (2022). Essays on information asymmetries in labor markets. Doctoral dissertation, Yale University.Yale Graduate School of Arts and Sciences Dissertations. https://elischolar.library.yale.edu/gsas_dissertations/662/
Highlights
- The study's objective was to examine the impact of salary history bans on sex gaps in employment, earnings, and wages.
- The author used a difference-in-difference design to estimate the impacts of salary history bans on sex gaps in employment, earnings, and wages using data from the January 2010 to December 2019 Current Population Survey. They used a statistical model to compare sex gaps in hourly wages, weekly earnings, and employment outcomes before and after the implementation of state-wide salary history bans for all employers for individuals living in states with these bans to individuals living in states without these bans.
- The study found that salary history bans significantly reduced the sex gaps in hourly wages and weekly earnings.
- The quality of causal evidence presented in this report is moderate because it was based on a well-implemented non-experimental design. This means we are somewhat confident that the estimated effects are attributable to salary history bans, but other factors might also have contributed.
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Intervention Examined
Salary History Bans (SHBs)
Features of the Intervention
Salary history bans prohibit employers from asking job applicants about their salary history during the hiring process. Employers are also prohibited from trying to obtain salary history from public records, background checks, or by asking applicants' current or former employers. However, applicants can self-disclose their salary history without being prompted. Salary history bans vary by jurisdiction in their implementation, coverage, and provisions. Although most state-wide salary history bans currently in effect cover all employers, some bans only cover public employers. In January 2017, New York became the first state to implement a state-wide salary history ban for all state employers and agencies. As of December 2019, 18 states (including the District of Columbia), 6 counties, and 10 cities had passed salary history bans.
Features of the Study
The study used a difference-in-difference design to estimate the impact of salary history bans on sex gaps in hourly wages, weekly earnings, and several employment outcomes: labor force participation rate, unemployment rate, private sector employment rate, public sector employment rate, unemployment to employment rate, employment to unemployment rate, job to job transition rate, private sector to public sector transition rate, and public sector to private sector transition rate. The author used data from the January 2010 to December 2019 Current Population Survey. The analysis sample included survey respondents aged 22 to 64 who were living in states that implemented state-wide salary history bans for all employers (the treatment group) or never implemented any state-wide salary history bans (the comparison group). Ten states implemented state-wide salary history bans on all employers during this period: Delaware, Oregon, California, Massachusetts, Vermont, Connecticut, Hawaii, Washington, Maine, and Alabama. The author used a statistical model to compare sex gaps in outcomes before and after the implementation of state-wide salary history bans for individuals living in states with a state-wide salary history ban for all employers to individuals living in states without these bans.
Findings
Employment
- The study did not find a statistically significant relationship between salary history bans and sex gaps in employment outcomes.
Earnings and wages
- The study found that salary history bans significantly reduced the sex gap in hourly wages by 2 percentage points and significantly reduced the sex gap in weekly earnings by 1.9 percentage points.
Considerations for Interpreting the Findings
The author acknowledges that firms in treatment states might modify hiring practices in anticipation of salary history bans. The author also notes that states that implemented salary history bans had smaller pre-existing sex gaps in hourly wages and weekly earnings than states that never implemented bans, and thus states that implement salary history bans might be more proactive toward reducing workplace sex disparities. The author addresses these concerns by demonstrating that pre-intervention trends in study outcomes were similar for both treatment and comparison states.
Causal Evidence Rating
The quality of causal evidence presented in this report is moderate because it was based on a well-implemented non-experimental design. This means we are somewhat confident that the estimated effects are attributable to salary history bans, but other factors might also have contributed.