The categorical generation of organizational inequality: A comparative test of Tilly's durable inequality

Abstract This paper develops a theoretical and methodological application of Tilly's [Tilly, C. (1998). Durable inequality . Berkeley, CA: University of California Press] assertions that inequalities are inherently relational and categorical. We focus on the specific proposition that inequalities are exaggerated when categorical social distinctions are mapped onto positional distinctions internal to organizations. Using samples of Australian and U.S. organizations we examine the influence of sex and other status distinctions upon between-class wage inequality. In both countries class inequality is exaggerated when workers are women and managers men. These between-class inequality producing processes are also present for other categorical distinctions available in the data we use (education, permanent vs. temporary worker, dominant vs. marginal linguistic group in Australia, permanent vs. temporary worker and white vs. non-white in the U.S.). In the U.S. the coefficients for relational sex composition are twice as large as in Australia, suggesting historical–institutional differences between the countries enables gender to exert a stronger influence on between-class inequality in the U.S. We further examine the institutional differences in these categorical bases for inequality by examining the extent to which they vary within the two countries as a function of two historically relevant institutional distinctions in wage setting regimes—formalization in the U.S. and centralized wage awards in Australia. As expected these institutional differences shape the extent and type of between-class wage inequality. We conclude that researchers should move methodologically towards observing relations within organizations to reflect the theoretical advances of the past two decades.