A stadium full of French socialists chanted “Equal Pay! Equal Pay!” after the U.S. women won the World Cup over the weekend. They were supporting the complaints of perpetually-angry-and-complaining Megan Rapinoe, the star of the U.S. women’s soccer team, about how the women are paid less than the men.
A little elementary economics can help explain why Megan is way out in left field on this. In a competitive market economy world one’s pay is correlated with one’s marginal productivity. That’s an economics term for how much you, as an employee, contribute to your employer’s profits. The more skilled, experienced, educated, and hard working you are, the higher is your marginal productivity and your value to employers. An important element of this is what the product or service is that you are involved in producing. If there is strong consumer demand for the product or service, then your services in producing it will be worth more to employers. I could be the best horse-and-buggy whip maker in history, but if there is slight demand for horse-and-buggy whips I won’t make much money.
Now, back to soccer. In the last men’s world cup event in Russia, revenues, mostly from television, were about $6 billion. For the recent women’s world cup they are estimated to be about $131 million, a small fraction of the men’s revenues (a little less than one-fiftieth). Orders of magnitude more people watch men’s soccer than women’s soccer. Compared to men’s soccer, hardly anyone cares about women’s soccer. The women are actually paid proportionally more than the men, however — 13% versus 9% of total revenues.12:27 pm on July 8, 2019 Email Thomas DiLorenzo