June 23, 2021

LGBTQ economics

Lee Badgett discusses her research on the effects of sexual orientation-based discrimination and how economists can engage in the fight for equality.

Lee Badgett is a professor of economics and co-director of the Center for Employment Equity at the University of Massachusetts Amherst, and she is the former director of the School of Public Policy.

Courtesy of the author

A lot has changed since the first economics papers on LGBTQ issues appeared in the mid-1990s. 

The volume of research in this area has grown significantly. There is more awareness of an expanding array of identities and a broader push to root out discrimination within the economics profession.

Lee Badgett wrote some of those early foundational papers more than two decades ago and has been at the forefront of studying the economics of LGBTQ populations. In a paper in the Journal of Economic Perspectives, Badgett and coauthors Christopher Carpenter and Dario Sansone provide an overview of the literature on LGBTQ individuals and some of the issues involved in advancing the subdiscipline. Getting reliable data is just one huge challenge that economists face.

Badgett spoke with Chris Fleisher about how the field has changed since her seminal papers on LGBTQ economics were published, her most surprising findings from researching this paper and latest book, and how she sees her role as an economist engaged in these issues.

The edited highlights of that conversation follow, and the interview can be heard using the podcast player below. 



Fleisher: You've said that coming at LGBTQ issues from an economic perspective has helped open conversations with people who were unwilling to engage on those questions when they were framed in human rights terms. Why do you think it's more comfortable to discuss the economic consequences of discrimination rather than the moral or human rights questions?

Lee Badgett: One piece of it is that sometimes people are surprised. When you can push against a stereotype and help people understand that what people had in their heads about what LGBTQ people are isn't quite right, sometimes that, I think, engages the brain in a different sort of way. But more than anything, I think putting some of these issues in economic terms can make people pay attention when they are in spaces that don't normally think about human rights issues or civil rights issues. Businesses are there to make profits, according to economists, and if you can show them how the challenges that LGBTQ people face might have an impact on their business, they will pay more attention. If you can convince policymakers that the decisions they make about policy on LGBTQ rights can make a difference for their economies, they might listen in a different kind of way. I think it takes it out of the realm of religion, of emotion, of morals, and puts it into a context that feels more practical.

Fleisher: You wrote the first empirical economics paper on sexual orientation-based discrimination back in 1995. How was that paper received by your colleagues and the larger profession at the time?

Badgett: Of the people who were interested in new ideas, I think many of them found it to be very interesting. I got a lot of very positive feedback from economists that I knew. Of the ones that I knew well, I actually received some concerned looks. They thought that this might be something that would maybe damage my career. I'm also a very out lesbian and I think that's another piece of concern that my mentors expressed. Others saw this as being a really good thing and an exciting thing to move forward because we just didn't have this perspective in our field.

Fleisher: One challenge with LGBTQ economics is getting reliable population data. A lot of it is based on self-reported surveys that, depending on the context, might lead some individuals to be cautious about how their data is going to be used. How reliable is the data right now and what do you think we could do to improve it?

Badgett: I think it's gotten so much better. That's why we're able to have this literature now. We certainly know that we miss some people, that there are people who would not feel comfortable coming out on surveys. The question is are they really different from the people we do see or are they kind of the same? There has been methodological research done to try to come up with questions that will work for a lot of people. For a long time, the biggest problem that arose was not with LGBTQ people knowing what box to check, but it was the idea that heterosexual people  sometimes were not sure. We've had a couple of big issues related to that. On a sexual orientation question for surveys, what the methodological researchers found was that if you just refer to heterosexual people as straight, do you identify or think of yourself as being straight... people had a much easier time answering that question. 

We did have a big issue with that with the Census data. The Census does not ask people for their sexual orientation or gender identity, at least in ways that transgender people or nonbinary people can answer. But they did allow us to see people who are in same-sex couples. A lot of research that has been done on LGBTQ issues has used same-sex couples as a kind of proxy for being LGBTQ, so you leave out single people. That's very unfortunate. But the other unfortunate problem is that heterosexual people might have misresponded on those surveys and accidentally marked that someone who identifies as a woman actually was a man. Suddenly, it looks like there's a same-sex couple there when there isn't. We actually had to figure out some ways of dealing with that. The Census bureau has gotten much better at correcting the problems that led to some of those issues. Data is improving as we learn where the sources of error are, but that underlying issue about whether an LGBTQ person is comfortable with saying that on a survey is still there.

Fleisher: As you were digging into the data for this JEP paper and also for your most recent book, The Economic Case for LGBT Equality, did you discover anything new or surprising?

Badgett: One of the things we have focused the most on in this research space is looking at wage gaps between gay and bisexual men compared to heterosexual men. We have very consistently found that gay and bisexual men earn less, which could be related to discrimination. For women, it's more complicated. We actually find that lesbian and bisexual women earn more than heterosexual women. We're still trying to understand why that is, but it probably has something to do with a different household division of labor, spending more time in the labor market over a career, maybe developing more skills, on the job training, that sort of thing. We saw these patterns—the higher wages for lesbians and the lower wages for gay men—for a long time in lots of different places. 

I think the key thing is to recognize that there are ways that discrimination happens to LGBTQ people that are not always visible. And one of the ways you know that is because people are not out.

Lee Badgett

We looked at the American Community Survey data on same-sex couples over time and actually found a really interesting pattern. First, things did not get better for the men in same-sex couples. They actually still have a gap that's fairly consistent over time. We looked back to 2000 and went up to 2018. That's surprising in some ways because of the big changes in acceptance and policy and other things that make people think things are getting better for LGBTQ people. For women, though, we did find a big change. That positive gap for the women in same-sex couples that was present for a long time has now pretty much disappeared. It's statistically insignificant. Something is going on there that I think will be a really great area for future research. It might be that heterosexual women are doing better and have more experience now. It might be that lesbians are more visible now, so there's actually more discrimination against them to balance out what other advantages they have. For us, I think it was one of the most surprising things that we saw.

Fleisher: How have legal rights granted to LGBTQ people, such as marriage equality or protection under antidiscrimination laws, affected their economic standing?

Badgett: We're just starting to understand those changes because they're fairly recent. Up until last year, there were no federal protections related to nondiscrimination. And now, because of the Supreme Court decision, it is illegal to discriminate against people because of their sexual orientation or gender identity because they're considered aspects of sex discrimination. There have been a few studies that have compared states that have had nondiscrimination laws for a while with those that don't to see if those laws have made any difference. We do find in the wage data that the wage gaps for gay men are a little bit lower in those states.

When it comes to marriage equality, economists played a role in this debate. Even before the US got marriage equality in 2015, there were people looking at what those impacts might be, both on same-sex couples and on different-sex couples. There were several studies that showed that in states that started to allow same-sex couples to marry, people were very happy to marry. Then we looked also at the different-sex couples. The studies basically showed that there was no effect of allowing marriage equality on the marriage behavior and divorce behavior of different-sex couples. 

Now people are starting to look to see whether it has mattered for health. There's one study that my coauthor Kitt Carpenter did that makes it look like there could very well be some positive effects on health or insurance coverage, especially for gay men. My other coauthor Dario Sansone has found that actually it looks like employment went up for gay men and for lesbians, people in same-sex couples. He thinks there's a good reason to believe that discrimination declined because of marriage equality, not because of nondiscrimination laws. Other people have found slightly different patterns where maybe one study showed that lesbians were reducing their paid labor market. They were working more at home. There might be more specialization because of marriage. 

Fleisher: Within the economics profession, there is a significant amount of discrimination as well. What steps would you like to see economics departments and the wider profession take to address some of these issues?

Badgett: I think some of the things that we can do are to help bolster the strategies and resources for LGBTQ economists, like having mentors, getting more opportunities to present papers, and just building for those who were doing work on LGBTQ issues. I think that it's also important to understand the sometimes hidden nature of discrimination against LGBTQ people. Our profession has a lot of problems with lack of representation. We're a very male profession. We're a very, very white profession. People of color and women have a hard time often making their way in being successful. For LGBTQ people, there may be a lot of us out there. We found about 5 or 6 percent of the survey sample reporting being LGBTQ, but that doesn't mean there's no discrimination. I think the key thing is to recognize that there are ways that discrimination happens to LGBTQ people that are not always visible. And one of the ways you know that is because people are not out. Less than half of the folks in that survey were very open to their colleagues in the context that they work in. That's a signal, along with those other data points, that people are facing some kinds of barriers. 

Fleisher: You've been pretty open about how you see your role, not just as an economist studying these LGBTQ issues, but as an activist. What role would you like to see economists play in not just studying these issues, but maybe advocating for LGBTQ individuals?

Badgett: I saw this as a great opportunity to do research that mattered in the world. I don't usually use the activist word myself. I think of myself as an engaged scholar. I think of myself as somebody who can help answer questions in an evidence-based way that can help move debates forward. I do sometimes advocate for particular positions. I think it's going to be important for economists to realize that we can play those sorts of roles.

Economics is a pretty effective social science for doing that kind of engaged work. I think we can probably do it better. I actually wrote a book based partly on my own experiences and partly on the experiences of other people called The Public Professor, which is about the kinds of skills and ways of thinking about our work that we can use to help make the world a better place. I think it's important that we know we can do that as economists, as social scientists. It's OK to have opinions and to state them and to talk about how we arrived at those opinions through reading of research and careful thought and study. I encourage young scholars to think about it in that way. It's a way to improve our teaching. It's a way to find new ideas for our research. The more we are engaged with what's going on in the real world the more vital our research will feel and the more we will contribute. It's one thing to teach a lot of students, but we can reach a much broader group of people out there in the public too.

“LGBTQ Economics” appears in the Spring 2021 issue of The Journal of Economic Perspectives.