We do need feminist economics, one that engages with Austrian economics

Read Giandomenica Becchio's Lead Essay.

Giandomenica Becchio has presented a fine, if provocative, essay extolling the virtues of an economics that explicitly accounts for the profound effects of gender in our lives, not least in respect of consumption, investment, production, and other economic decisions. In short, Becchio states that we need feminist economics, and that we need it to better understand, if not resolve, problems such as gender inequality. My response to Becchio is that I agree, we do need feminist economics. It would be inconceivable of me to suggest otherwise, given that I have long expressed an interest in feminist economics and the economics of gender.

Becchio presents a world of gendered inequalities that is reflected in patterns of working hours, wage distribution, and the division of household production. Like Becchio, feminist economists also recognize the gender implications of broader social phenomena, such as marriage and reproductive decisions, and their effects over labor supply and savings decisions. Gender inequality has been a focal point for political struggles, and a critical driver of economic change as illustrated by scholars such as Claudia Goldin. Even Gary Becker, whose orthodox theories have served as a useful foil for many feminists’ economic arguments, acknowledged that “changes in the gains from work for pay have had a more powerful effect on the behavior of women than have traditional ideas about the proper role of women.” But, as Becchio observes, gender inequalities persist.

Before returning to inequality matters, I outline an affinity between feminist economics and Austrian economics, the latter intimately associated with classical liberalism. A principal advocate for this conciliative move was Steven Horwitz. He suggested that Austrians and feminist economists alike share an incredulity toward reductive, Cartesian-style conceptions of economic agency. Horwitz built on this conviction with his seminal 2015 book, Hayek’s Modern Family, presenting a process orientation to family formation and decision-making eschewing the oversimplifications of the orthodox agenda. Another important contributor toward paving a conciliative pathway between Austrian and feminist economics is Deirdre McCloskey.

Recent developments in Austrian economics present another opportunity for productive conversations with feminist economics. Scholars such as Don Lavoie, Virgil Storr, and Emily Chamlee-Wright demonstrate that culture is a key element to that broader institutional environment which shapes the incentives and payoffs surrounding economic activities, including entrepreneurship. In a recent contribution Ginny Choi and Storr add that, “we understand people are complex, fallible, emotive, social beings whose actions and motivations we cannot hope to comprehend without appreciating the political, economic, social and historical contexts in which they are embedded.” Feminist economists would surely find themselves agreeing with Choi and Storr.

Gender is just one aspect of culture. To the extent that contemporary Austrian economists recognize culture they, by logical extension, recognize gender.  Austrian economics scholarship that focuses upon gender concerns has, indeed, provided sophisticated accounts of how culture influences an array of economic activities. Emily Chamlee-Wright’s investigation into female entrepreneurship in Ghana reveals how entrepreneurial action is influenced by gender expectations at household, kinship, and societal levels. On another matter, Horwitz and colleagues indicated that gender stereotypes concerning the capacity of girls and young women to engage in STEM disciplines, and related precepts about “appropriate” working roles for women, are likely to affect education and training decisions to some extent.

Austrian and feminist economists can, and should, engage one another, but there are likely to be significant differences in view over some topics. Austrian economists, such as Karen Vaughn, have identified differences with feminist economists particularly over the contribution of markets toward women’s economic welfare. Differences in economic outcomes between men and women do not automatically indict the market with charges of sexism, say the Austrians. Individual women (and men) retain agency to discover, along various margins, modes and processes of economic activity that better align individual betterment with social cooperation. This agency is operative even in the presence of gender-based norms and misogynistic institutions. To refer once more to Choi and Storr, Austrian economists do not “perceive people as powerless against their own circumstances, unavoidably plagued by their biases, whose decisions and fates are instantaneously and fully determined by their environments.” These propositions are empirically supported by positive associations between women’s economic progress, and gender equality, and economic freedom.

Becchio catalogs the ways in which inequalities register economically between women and men. The finer details concerning the determinants of estimated gender wage gaps, and the like, could be debated, but I set them aside to agree with Horwitz et al.’s statement that the likes of the gender wage gap imply “differences in the way men and women experience the world that impact the choices they make.” The Austrian inclination against cultural helplessness suggests opportunities for people to exercise agency in a way that seeks to promote gender equality. The extent of agency I have in mind goes beyond mechanisms familiar to Austrian economists – such as the exit response of mobility toward better-paying jobs, or the creativity of entrepreneurial efforts entailing provision of work situations more amenable to the needs of women (and men).

In a free society, individuals are able to voluntarily collaborate on projects to achieve jointly-agreed ends. As one example, consider efforts to develop communities of knowledge, such as women’s academic and professional associations. It is here that members can share information about employment opportunities, discuss intelligence about suitable (and unsuitable) workplaces, and collaborate in skills formation and honing capabilities, all of which can help close gender disparities in the economy. True, no single measure will enshrine equality, and it is unreasonable to enshrine perfect equality given the innate liberal respect for differences amongst moral persons, but a culturally attuned Austrian economics recognizes voluntary collaborations as one way to shift gender attitudes.

Feminist economics illuminates the nature and implications of inequalities associated with gendered culture. Austrian economics provides hope for the power of creative agentic elements within cultural change. Both schools of thought should confer.