Is there pay discrimination against female movie stars? Helaine Olen at Reuters thinks so. She writes:
Why should we begrudge [Robert] Downey a $50 million payday for The Avengers? The film brought in $1.5 billion globally. Downey’s take was a mere 3 percent of the haul.
Hunger Games producers first signed [Jennifer] Lawrence to a deal in 2011. She was still a relative unknown, albeit one with an Oscar nomination on her credits. So they could sign her to play the lead, Katniss Everdeen, for less than $1 million — a relative pittance for such a high-profile movie.
The film went on to earn $400 million in the United States, and $691.2 million globally. Using the logic of Downey’s payday, Lawrence should have received $20 million for the second installment in the Hunger Games series.
Instead, Lawrence received a $10 million salary for starring in Hunger Games: Catching Fire, which went on to gross $830 million internationally. This feat allowed Lawrence to achieve the third spot on the most recent Forbes’ “Best Actors for the Buck” list, right below fellow female stars Emma Stone and Mila Kunis.
You know us ladies. We always offer good value. Gendered salary gaps will accomplish that.
Let’s look a little more closely. First, consider the Forbes piece Olen cites. It is strange, to say the least, from a financial magazine:
Emma Stone tops our list — for every $1 the studios paid Stone for her last three movies, we calculate that they earned back $80.70.
Much of that is thanks to The Amazing Spider-Man. The 2012 movie was one of the highest-grossing of the year, earning $752 million at the global box office. Sony was able to hire Stone on the cheap to play Gwen Stacy the first time around, but the studio is paying her a lot more for the sequel.
To compile our list we looked at the last three movies each actor starred in over the three years to June 1, 2013. We did not count voice work because actors always take less pay to do cartoons and those films tend to make lots of money. Plus the actors aren’t really the main draw. So for Stone, we’re not counting her work in The Croods, which was a big hit for DreamWorks Animation.
Taking a star’s pay on a film, and the movie’s estimated budget, box-office receipts and DVD sales, we calculated a return on investment number, and then averaged the numbers for their last three films to get an overall return.
But that is not a return on investment in the star at all. It gives no sense of whether hiring Emma Stone, or a different actress, is a sound decision, since for that we would need to know what it was that Emma Stone did to generate revenues for the film. In some cases, the presence of a particular actor will make a big difference in audience’s willingness-to-pay to see the movie, and in other cases it will not. But we don’t know (and Forbes doesn’t seem to think we even need to know) what Emma Stone did for Amazing Spider-Man revenues. We need to know Emma Stone’s marginal contribution to the film: what did she add to its value?
And that’s why it is wrong, as Helaine Olen suggests we might, to use ‘the logic of Downey’s payday’ to figure what Jennifer Lawrence ought to have been paid for Hunger Games. It is not a simple matter of taking a share of box office, or of net revenues. We need to know what each of them contributed at the margin to the film’s success. And that is not easy to do.
Each of these articles suggests that women are starring in movies that earn large returns, yet they command less pay than male stars. There are a couple of possibilities. One is that there are certain male stars who really do have a large impact on box office, and accordingly can command higher pay. If Robert Downey Jr. makes a very big difference to the appeal of The Avengers, then he can demand a very large sum. Keep in mind that we are talking about movie stars: Downey and Jennifer Lawrence and Emma Stone are not just inter-changeable actors, but distinctive, popular personalities that audiences recognize.
A second possibility is that women stars really are a great investment for movie producers, given the high box office they generate relative to their pay. If that is true, then we would expect movie producers, at least those who have read Moneyball, to seek out those high-value female stars. If that happens, then the ‘gender gap’ will be short-lived, as female stars’ paychecks would be bid upwards by competing producers. Remember, the essence of ‘moneyball’ strategy is that you find people the market is undervaluing, and bring them on board. But the strategy only lasts so long as you are the only one using it. Once everyone else starts to recognize the returns to hiring different movie stars (or center fielders), the returns to the strategy begin to diminish.