Empirical studies show that the average woman earns $0.80 for every dollar earned by the average man, after controlling for age and education. Further, the average woman earns $0.92 for every dollar earned by the average man after controlling for occupation . The conclusion is made that occupational choice reduces the wage gap 12 cents and discrimination is left to explain the remaining 8 cents.

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Price Discrimination

Price discrimination or differential pricing is based on the principle that the seller will charge the buyer a price based on the buyer’s ability and willingness to pay for the product rather than applying uniform pricing for all.