04/05/2011
Walmart is the biggest private employer in the world, has the biggest annual revenue, and earns the 9th largest profits.The Supreme Court is currently considering whether a massive class-action lawsuit claiming to represent all million-plus female employees of Walmart can go forward based on disparate impact statistics.
The crude view of discrimination is the standard Who-Whom one, which assumes that of course Walmart pays less to women because Walmart is run by white men, who are evil.
A more sophisticated view is the Malcolm Gladwellian one. Back in the 1950s, Gary Becker wrote his doctoral thesis for his adviser, Milton Friedman, on how discrimination is economically irrational because it costs the employer profits. If you pay below the market rate, you get lousier employees and customers go away.
In a section in Blink on how car salesmen charge women and blacks more money, Gladwell added a new level to the U. of Chicago theory: Discrimination happens not because business executives are evil but because their consciousnesses about their biased implicit associations haven’t yet been raised by expensive-enough guest speakers at their annual sales conventions. Walmart executives, like car salesmen, are, when you stop and think about it, the real victims here. They're leaving money on the table because they don’t realize that they don’t realize that everybody is equal, which everybody is, of course. That goes without saying.
In my experience, however, Walmart never leaves money on the table.
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