Cato At Liberty

“Are Shoe Brands Charging You More Based On Your Gender?” asks Footwear News. The website cites data compiled by Datafiniti showing that high-end footwear brands tend to price women’s shoes higher than men’s. As examples, the median price of a Gianvito Rossi pair of women’s shoes was $750 versus $469 for the gent’s.

Such data has become increasingly of interest following the New York City study entitled “From Cradle to Cane: The Cost of Being a Female Consumer,” which was then replicated by The Times newspaper in London, both purporting to show that women were discriminated against in pricing terms for a range of everyday products. Particular examples in the surveys included children’s scooters, women’s hair products and razors. This comes alongside previous studies from the University of Central Florida and Consumer Reports, which found that women tended to pay significantly more for deodorant, haircuts, and dry cleaning.

Does all this show “sexist” pricing and discrimination against women?

Here’s some economics to bear in mind which might explain why the prices of goods might differ in these types of surveys:

1. There can be cost of production differences in some cases: often men’s clothes and shoes tend to be more standardized than those targeted at, and bought by, women. This explains why both women’s clothing and dry cleaning of that clothing can be more expensive too, given the clothes cannot be handled in the same way. It does not seem a stretch of the imagination to suggest that women’s hair cuts tend to be more expensive as a function of length, time, and the variety of tastes as well.
2. Though things like different colored razors have the same functional uses, the branding and designs are themselves part of the product. It might be that many women place inherent value on some products being branded as “for women” or else enjoy the scent, colors etc. Indeed, there is nothing to stop women buying male or unisex branded products (some women I know do), suggesting the continued existence of gendered variants is evidence of demand. Prices that maximize profits will be higher for women than men if women are less responsive to price (i.e. have more inelastic demand). This might be because of greater attachment to brand, or because women perceive products tailored to women as being of higher quality.
3. For some products targeted at women, women may buy fewer units of any given brand relative to men (on products where women prefer variety), which would (other things given) lead to higher prices too.
4. The surveys themselves may be biased towards standardized products with male and female versions. Tyler Cowen speculates, for example, that women might (on average) have a relative taste for variety and quality on these type of low value products, whereas men tend to spend more cheaply on these but more on products not differentiated by gender (such as automobiles, electronic sound systems etc).
5. The example of nightclub cover charges, where women frequently obtain “free” entry, shows that for some goods and services men tend to pay more than women. Even in the shoe study, the data shows that the median price for moderately priced sneakers tends to be higher for men than women’s shoes. A pair of Nike women’s shoes was $80 vs. $85 for men. Some of the above economics might explain this (particularly the elasticity explanation), but with things such as nightclub nights the charge may help cover for probability of externalities – i.e. drunken violent behavior. Another example of this is vehicle insurance, where men tend to pay more than women for near identical products due to higher costs associated with a tendency towards more risky behaviors for men.

As seen then, there are many different rational explanations for why different prices might be charged for products targeted at different genders. This is certainly not an area where there are obvious “market failures” which justify government intervention.

The implicit criticism by some of this practice seems to be opposition to the mere existence of “gendered” products at all. Indeed, in a debate I had on the subject in the UK, my female opponent claimed that women did not want products to be “gendered.” If this is true, it suggests there is an exceptional entrepreneurial opportunity for companies to develop more unisex products. 

The federal government funds an array of aid programs aimed at promoting growth in less-developed countries. Funding goes to federal agencies, such as the U.S. Agency for International Development, and it also goes to international aid groups, such as the World Bank.

The federal government spends more than $30 billion annually on foreign aid. Aid spending has more than doubled in the past two decades. The Trump administration has called for substantial cuts to foreign aid spending.

Ian Vásquez has published a new study on foreign aid at DownsizingGovernment.org. He argues that despite the political enthusiasm for aid, there is little evidence that it is effective. Indeed, it is often counterproductive. There is no correlation between foreign aid and economic growth, and efforts to condition the receipt of aid on market reforms have failed. As such, Ian argues that the federal government should end its development aid programs.

However, Ian also discusses the good news on economic development. Decades of experience show a strong relationship between economic growth and market-oriented policies. Countries eager to improve living standards can do so themselves with domestic reforms, such as securing property rights, reducing arbitrary and bureaucratic regulations, and encouraging entrepreneurship and investment.

Ian’s new study on foreign aid is here.

Yesterday, Attorney General Jeff Sessions reanimated the suspended Department of Justice program that allows local police to circumvent their own state laws to profit from seizing property from individuals who have not been charged, much less convicted, of a crime. Over at Democracy: A Journal of Ideas, I wrote that this may have the unintended consequence of increasing racial profiling on American roads:

Virtually everywhere police stops are counted and measured demographically, black and/or Hispanic drivers are over-represented in those pulled over and subsequently searched for contraband. The vast majority of searches of drivers across ethnicities come up empty, and statistics show that black and Hispanic drivers who are searched are less likely to be carrying contraband than whites who are similarly searched.

Stopping drivers to search for drugs and drug proceeds is much cheaper than developing leads and building cases against large drug organizations through buy-and-bust operations or long-term stings, making interdiction through traffic stops all the more appealing. For that reason, while the disparity in stops almost certainly exists independent of asset forfeiture laws, increasing the use of forfeiture will likely result in an increase of racial profiling.  

These traffic stops that officers initiate to search a car aren’t the typical traffic stops many Americans have experienced. These stops are intrusive, probing, invasive interrogations that are designed to get presumptively innocent people to give up their right to not be searched. These stops are degrading, and the people who experience them–disproportionately black and Hispanic drivers–resent being treated like criminals with something to hide. As I wrote in the Case Western Reserve Law Review, this can diminish police legitimacy in minority communities and thus can erode public safety.

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