Gender Pay Gap, Productivity Gap and Discrimination in Canadian Clothing Manufacturing in 1870

Women's earnings were less than men's in Canadian clothing factories in 1870. Orthodox neoclassical theory would explain that gender pay gap as a reflection of a gender productivity gap. Using classical hypothesis testing we reject that view, based on a large cross-section of 1870 census data. We find the gender pay gap was significantly larger than the gender productivity gap, much as Hellerstein et al. [1999] found for US manufacturing circa 1990. Our results are clear and compelling evidence of gender pay discrimination, contrary to the view that unregulated markets are efficient or fair.