Gender Pricing: When Do Women Pay More Than Men?
NYC fined the owner of Freckle Skin and Hair for charging men less than women for haircuts. “It’s ridiculous, I have some guys who need to come in every two weeks. If I raise my prices, I’ll lose all my male customers.”
Passed in 1998, NYC has a gender pricing discrimination law. Responding to business owners who oppose the regulation, the head of the Department of Consumer Affairs said that “reasons are not chromosomes.”
In a gender pricing article, Marketwatch.com listed deodorant (prices similar but men got more in the container), cars (white men quoted lower prices than women even before negotiating), dry cleaning (women’s shirts more than men’s identical shirts), mortgage rates and…
Nationally, the Affordable Care Act makes health care gender discrimination illegal. As a result, long term care insurers are being challenged for charging women more than men. For two comparable policies, a 55-year old man will pay $925 a year while a women will pay $1225.
It’s never that easy, though. Salons point out that for waxes, manicures and haircuts, men and women should be charged differently. It takes more labor to wax a male back or clean men’s nails. By contrast, women’s haircuts can involve more time. For long term care insurance, women’s policies cost more because woman live longer and receive a higher proportion of long term care spending.
As always, we have a tradeoff. For the regulatory prohibition of gender based pricing, sometimes we have to choose between efficiency and gender equity.
Sources and resources: I discovered that Quartz’s map of gender based pricing for haircuts was just the tip of the iceberg when I read this Marketwatch list of discriminatory pricing, WSJ’s article on NYC’s law against the pricing gender gap, and a NY Times article on the pricing gap for long term care insurance. For the dilemmas, in a gated paper, Catherine Liston-Heyes, an economist at the University of Ottowa, considered transaction costs vs gender equity.