Graduation Year

2023

Date of Submission

4-2023

Document Type

Open Access Senior Thesis

Degree Name

Bachelor of Arts

Department

Economics

Reader 1

Cameron A. Shelton

Rights Information

© 2023 Jiwon Chung

Abstract

Recent research has indicated the adverse economic outcomes of transgender people. The titular question of this paper refers to the effect on gendered economic outcomes that differences related to sex assigned at birth has for a sample of transgender individuals that is plausibly correlated with being at an early stage of their gender affirmation processes (e.g. social or medical transition). For this group of plausibly early-in-transition transgender individuals, I hypothesize and test a theory that draws the following account: assigned female at birth (AFAB) transgender individuals encounter significant economic penalties as a result of labour market decisions (i.e. industry sorting) that align with their same-sexed cisgender women counterparts. Similarly, I argue that the significant economic penalties experienced by assigned male at birth (AMAB) transgender individuals are driven by factors related to their transgender status. I find some significant evidence in support of the sex-differentiated labour market decisions as a driver of the adverse economic outcomes of the AFAB transgender individuals in my sample; closing a given industry’s overall wage gap by 1 cent on the dollar is associated with a roughly 4% increase in income for AFAB transgender workers. The extent of the traditional gender wage gap in an AFAB transgender worker’s chosen industry has significant consequences, suggesting the enduring role that traditional gender norms play in determining the economic outcomes of AFAB transgender people.

I conduct a replication of Carpenter, Lee, and Nettuno’s (2022) study on the economic outcomes of transgender people that uses data from the Census Bureau’s Household Pulse Survey (HPS). After estimating with the inclusion of more recent data, I find results that imply different understandings; I now find adverse outcomes for AMAB transgender individuals relative to cisgender men, where there were previously none. The titular question thus addresses mechanisms that help understand this new finding.

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