Who pays for sexual harassment?

Calculating the economic costs of sexual harassment obscures its underlying wrongs – as does the disparagement of people that ‘sleep their way to the top’. The Weinstein scandal calls both of these approaches into question

This is the second blog in a series on the political economy of the Weinstein scandal

The dominance of orthodox economics in society is hard to overstate: both in the sense that its logics pervade, increasingly, all aspects of our ‘private’ lives and insofar as it is the lens through which most issues are interpreted. Partly due to this very ubiquity, the lens can be rendered invisible, giving the impression of an objective standpoint. Conducting a political economy of the Weinstein scandal involves interrogating this ‘objectivity’ in the pursuit of a deeper understanding. For this reason, a useful starting point is the literature and broader narrative on sexual harassment in the workplace.

How, then, does orthodox economics seek to explain workplace sexual harassment and assault? One common way of framing the issue, bolstered by endless figures and calculations, is that sexual harassment costs. This is what some call the ‘business case’ for cracking down on sexual harassment. Sexual harassment costs governments, because they have to fund the organisations which receive and pursue claims of harassment. It costs companies, who have to pay out legal fees and fund anti-harassment training. It costs society in general, because gender inequality deprives society of the ‘new ideas [that allow] economies to grow richer year after year’ by suppressing the innovative talent of women. Far less effort has gone into investigating the economic costs for individual victims of harassment, but a study has found that ‘harassment targets reported significantly greater financial stress’. All these costs provide a financial incentive to reduce sexual harassment. The ‘business case’ against sexual harassment is often underpinned by an implicit normative commitment: that the workplace should be an economically productive environment uncontaminated by the corrupting, distracting nature of sexuality.

One problem with this account is, by the admission of its proponents, the ‘inefficiency’ of sexual harassment has not led to its eradication. A surprising result, given the purported tendency of the market to smooth out all irrational elements. Perhaps, then, this is the wrong way to look at it – maybe the phenomenon requires a full Gary Becker style analysis, according to which the laws of market exchange can be applied to all realms of human activity.  On a ‘quid pro quo’ picture, sex or submission to/tolerance of sexual advances is exchanged for promotions or job perks. Intimate interactions like these are to be viewed as valid transactions. Of course, given existing inequalities, the idea that women can really ‘get ahead’ by doing this is somewhat unrealistic; it is more likely that whatever advantages are gained by women still leave them behind men. But nevertheless, those willing to put up with harassment can legitimately profit from it: one analysis finds that workers are paid a ‘premium’ in jobs with a high risk of sexual harassment ($0.50 an hour for men and $0.25 for women). If the very existence of that calculation feels uncomfortable (absurd, even), so should the intellectual tradition lurking in the background.

Though these two ways of understanding sexual harassment differ, they share a common foundational assumption: that sexual harassment can be understood according to market logics. It is either a hindrance to productivity which must be dealt with through training and managerial strategies, or it is just another transaction in a world of transactions. But can either account really explain the Harvey Weinstein scandal? How could it be that long-standing, systematic abuse and assault of women was rife in one of the most lucrative film studios of all time, if this kind of behaviour is counter to productivity?

Of course, Hollywood defies categorisation as a typical ‘asexual’ workplace – it is by many accounts the opposite. But it presumably isn’t an exception to the ‘law’ that in a competitive market, the unfaltering measurer of talent, those who are not deserving of success simply won’t make it. So how did one man threaten the careers and livelihoods of so many women based not on their individual merit, or lack thereof, but on their willingness to submit to his sexual advances?

Further, though this case attracted a particularly high level of attention, there are Weinsteins in every domain: even the workplaces which fit the stereotype of ‘asexual’ hives of productivity. The US Equal Employment Opportunity Commission identifies ‘superstar’ harassers as ‘those who are particularly valuable or powerful in their workplace’ (sound familiar?), noting that individuals of this type tend to feel entitled to engage in dominating behaviours such as sexual harassment and generally behave as if they are above the rules. But if the ‘superstar’ brings in a lot of money, then a sexual harassment policy with profit as its underlying aim is ill-equipped to motivate their prosecution.

Given the challenges of making the business case for sexual harassment, one might revert to the hardline quid pro quo picture. According to this, the women Weinstein assaulted were paying the price for fortune and fame. The repeated phrase, ‘everyone knew’ is, on this picture, a testament to the fact that the women themselves knew – knew what they were getting into, knew what they had to do to ‘get ahead’. But the inadequacy of such an argument lies in the idea that market transactions are made ‘freely’ between consenting parties. This conceals a failure to understand the ways in which, as Brit Marling puts it, ‘consent is a function of power. You have to have a modicum of power to give it’. Though Weinstein’s offences go far beyond the standard remit of ‘sexual harassment’, the lesson to be learnt is that the logic of exchange cannot be readily applied to parties who have more or less to lose.

The Weinstein scandal, then, reveals the shortcomings of orthodox approaches to sexual harassment. Political economy invites instead a focus on the ways in which hierarchical workplaces and material inequalities between men and women in fact might create the Weinstein ‘superstars’. Instead of assuming that sexual harassment is a given, a political economy approach must take account of the fact that unchecked wealth and power (or lack thereof) shapes the behaviour of subjects: their sense of entitlement, or their inability to consent.