Andrew Allard '25
Editor-in-Chief
In the United States today, more women hold bachelor's degrees than men, and that gap continues to widen.[1] Why, then, is the wage gap increasing for women with college degrees? In a new book, Fair Shake: Women & the Fight to Build a Just Economy, Professors Naomi Cahn, June Carbone, and Nancy Levit claim to have found the culprit: the winner-takes-all economy.
Last Tuesday, Professors Cahn and Carbone introduced their book to a crowd of students. As they explain, the “winner-takes-all” (WTA) economy allows corporate leadership to consolidate resources for their own benefit, often through illegal or unethical means. For everybody else, high-stakes bonuses are doled out based on short-term metrics that are “impossible to meet without cheating,” Professor Carbone explained.
This system, the professors argue, has allowed toxic leaders to thrive at the expense of workers’ health and quality of life. Such businesses, sometimes described as having “masculinity contest cultures,” are characterized by low trust, high stress, and zero-sum competition. “When you create that kind of environment, you drive women out,” said Carbone. “These high-stakes bonus environments are counterproductive [and] are associated with greater fraud, distrust, higher turnover, lower morale, and lesser productivity.”
The professors recalled an interview with a woman who had been fired from her job as an office manager at a dentist’s office at the height of the COVID-19 pandemic. The unnamed interviewee, whose teenage son was taking care of her newborn child, had to stay home when her son caught COVID-19.
“We went in thinking—oh, a dentist. Small office, the dentist needs his manager, can’t do without her—he was in a rock in a hard place. We found out: no. Private equity in New York made the decision to fire her,” said Professor Carbone. This story, Carbone explained, illustrates the spread of the WTA model. “It’s not about the dentist. It’s not about the needs of the dental office. It’s about their focus on quarterly earnings and the need to show a constant earning sheet . . . It’s violating arguably new regulations passed to protect workers during Covid, and they don’t care.”
Not only is the growing gender gap a potential problem for the legal equality of women, but also, as Professor Cahn explained, these same trends can be observed in the legal profession. “Although more than half of all law school grads are women, the number of women in senior leadership roles at U.S. law firms is far less than half. 22 percent of equity partners were female in 2020, 15 percent in 2012,” said Professor Cahn. And the percentage of women among the highest-paid attorneys in law firms has decreased from 8 percent in 2005 to just 2 percent in 2020.
Professor Carbone is nonetheless optimistic that the disadvantages of these systems are leading investors to switch to more open business models. “In corporate America, there’s actually greater recognition of the business case for diversity . . . . While diversity doesn’t guarantee good practices, the lack of diversity is almost always associated with bad practices.” This change in thinking has motivated changes in business practices, like the NASDAQ’s new disclosure requirement for diversity in corporate boards, added in 2020. “It’s not about being woke, and it’s not about DEI,” said Professor Carbone. “It’s about a tell.”
Professor Cahn similarly expressed optimism about the possibility of change. “There are already changes happening in corporate America . . . . Your generation is already emphasizing the importance of work-life-family balance.” Professor Cahn suggested that an increase in men taking family leave may also help, as maternity leave is a major contributor to the wage gap.
Stressing the availability of viable alternatives, the professors also noted that the mid-century predecessor to the modern winner-takes-all paradigm was characterized by values now seen as feminine. The so-called “Company Man,” emblematic of the era, had a collectivist approach to work. Whereas then, employees bragged “My company is better than yours,” today, instead we brag “My bonus is bigger than yours,” explained Professor Cahn. “There was a feeling of community . . . . The values associated with community and cooperation, today seen as feminine values, in earlier times were seen as male values.”
The trio of professors began working on the book in 2016 when they still believed then-candidate Hillary Clinton might soon be president. “One of the nice things about the eight-year process was that after we started, that’s when #MeToo happened. And so, there were some changes. There was more visibility to some of this that also occurred after we started,” said Professor Cahn. But one thing that didn’t change in those eight years: the fact that women at the top are falling behind.
Professor Cahn is the Justice Anthony M. Kennedy Distinguished Professor of Law at the University of Virginia School of Law. Professor Carbone is the Robina Chair in Law, Science and Technology at the University of Minnesota Law School. Fair Shake: Women & the Fight to Build a Just Economy will be available for purchase beginning in May.
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tya2us@virginia.edu
[1] Kim Parker, What’s behind the growing gap between men and women in college completion?, Pew Research Center (Nov. 8, 2021).