Missing the opportunity
Bargaining while Black: The role of race in salary negotiations
Morela Hernandez et al.
Journal of Applied Psychology, forthcoming
The influence of race in negotiations has remained relatively underexplored. Across three studies, we theorize and find that Black job seekers are expected to negotiate less than their White counterparts and are penalized in negotiations with lower salary outcomes when this expectation is violated; especially when they negotiate with an evaluator who is more racially biased (i.e., higher in social dominance orientation). Specifically, on the basis of the prescriptive stereotype held by those higher in racial bias — that Black (as compared to White) negotiators deserve lower salaries — we predicted that Black negotiators who behave in counterstereotypical ways encounter greater resistance and more unfavorable outcomes from more biased evaluators. We tested this argument in a stepwise fashion: In Study 1, we found that more biased evaluators expect Black job seekers to negotiate less as compared to White job seekers. When Black negotiators violate those expectations, evaluators award them lower starting salaries (Study 2), which appears to occur because evaluators become more resistant to making concessions to Black than to White job seekers (Study 3). Collectively, our findings demonstrate that racially biased perceptual distortions can be used to justify the provision of smaller monetary awards for Black job seekers in negotiations.
Relationship of gender differences in preferences to economic development and gender equality
Armin Falk & Johannes Hermle
Science, 19 October 2018
Preferences concerning time, risk, and social interactions systematically shape human behavior and contribute to differential economic and social outcomes between women and men. We present a global investigation of gender differences in six fundamental preferences. Our data consist of measures of willingness to take risks, patience, altruism, positive and negative reciprocity, and trust for 80,000 individuals in 76 representative country samples. Gender differences in preferences were positively related to economic development and gender equality. This finding suggests that greater availability of and gender-equal access to material and social resources favor the manifestation of gender-differentiated preferences across countries.
Mandating Women on Boards: Evidence from the United States
Sunwoo Hwang, Anil Shivdasani & Elena Simintzi
University of North Carolina Working Paper, November 2018
On September 30, 2018, California became the first US state to mandate women directors on corporate boards. The passage of this law resulted in a significant decline in shareholder value for firms headquartered in California. The decline in shareholder value is directly related to the number of female directors that firms are required to add to the board. We argue that supply-side constraints contribute to the costs imposed by the mandate. The expected costs of additional female directors are higher for firms that face a more limited director pool and for those with weak corporate governance. Our findings indicate that mandated increases in gender diversity on corporate boards are detrimental to shareholder value.
Valuing the risk of workplace sexual harassment
Journal of Risk and Uncertainty, October 2018, Pages 111–131
Using data on sexual harassment charges filed with the Equal Employment Opportunity Commission, I calculate the risk of sexual harassment by gender, industry, and age and establish that white females, but not nonwhite females, receive a compensating wage differential for exposure to a higher risk of sexual harassment. I use this risk premium to calculate the value of statistical harassment (VSH) in a manner analogous to the calculation of the value of statistical life (VSL). The VSH is around $7.6 million, about three-quarters of the size of the most-commonly cited levels of the VSL, and far above the maximum damages award for sexual harassment available under federal law. Boosting the maximum damages award to equal the VSH would create the appropriate economic incentives for organizations to deter sexual harassment.
You’re Fired! Gender Disparities in CEO Dismissal
Vishal Gupta et al.
Journal of Management, forthcoming
CEO dismissals attract considerable attention, presumably because of the visibility, publicity, and intrigue that often surrounds the decision to fire the CEO. With the goal of advancing scholarly understanding of CEO dismissals, we examine whether CEO gender influences the likelihood of dismissal. We theorize and find that ceteris paribus, female CEOs are significantly more likely to be dismissed than male CEOs. Perhaps even more importantly, we find a CEO gender by firm performance interaction such that male CEOs are less likely to be dismissed when firm performance is high (compared to when it is low), whereas female CEOs have a similar level of dismissal likelihood regardless of firm performance. Notably, our results are robust to multiple analytical techniques and various econometric specifications, bringing greater credence to the validity of our findings. Implications and directions for future research are also discussed.
Butchers, Bakers, and Barcharts: How Digitized Information Affects Gender Differences in Performance
Harvard Working Paper, November 2018
This study asks: does increased access to digitized information affect the performance of men and women workers differently? I find that the availability of information in digital platforms disproportionately improves women’s performance in a male-dominated organization. I theorize that digitized information helps women by serving as a relationship substitute, an alternative channel to traditional relationship networks through which peripheral group members can gain access to performance-enhancing information. Using interviews, observations, and archival data, I take advantage of an intervention occurring within a 100-store grocery chain — when it introduced a weekly online report providing managers with a high-level summary of their departments’ performance along key metrics. Comparing sales across 152 departments twelve weeks prior to and following the report’s implementation shows that women managers benefit disproportionately from the report’s introduction but having longer duration of contact with peers and supervisors attenuates its benefits. Findings offer new directions for research on gender inequality and knowledge transfer by suggesting that digital channels of knowledge distribution can offset disparities arising from relationship networks in organizations.
Third-party prejudice accommodation increases gender discrimination
Andrea Vial, Victoria Brescoll & John Dovidio
Journal of Personality and Social Psychology, forthcoming
We investigated how gatekeepers sometimes arrive at discriminatory hiring selections to accommodate prejudiced third parties due to role demands (i.e., the “third-party prejudice effect”). Studies 1 and 2 show that individuals in charge of personnel decisions were significantly less likely to select a woman when a relevant third party (the chief executive officer of the company in Study 1; the “proposer” in an ultimatum game in Study 2) was prejudiced against women. Gatekeepers accommodate third-party prejudice in this way in order to avoid conflict in relations and task-related problems that would likely occur if the gatekeeper introduced a member of the target of prejudice into an organization. Studies 3 and 4 demonstrated that both interpersonal and task-focused concerns significantly mediated third-party prejudice accommodation. Furthermore, experimentally reducing task-focused concerns significantly reduced the accommodation of third-party prejudice against women (Study 4). We also found that gatekeepers accommodate third-party prejudice regardless of their own beliefs and attitudes (Studies 5 and 6), or their own desire to get along or affiliate with the third party (Study 7), and despite leading to feelings of guilt (Studies 4 and 5). Both men and women accommodated third-party prejudice against women. A role-based framework can be useful to understand the persistence of gender inequality in various fields and organizations, even as individuals endorse increasingly gender-egalitarian views.
Women in a men’s world: Risk taking in an online card game community
Eszter Czibor, Jörg Claussen & Mirjam van Praag
Journal of Economic Behavior & Organization, forthcoming
Analyzing a large data set from an online card game platform, a traditionally masculine environment with low female representation, we provide novel field evidence for gender differences in risk taking. Our paper complements existing laboratory experiments by studying a setting where selection into and out of the choice environment is endogenous, choices and outcomes are publicly observable and decisions are repeated over hundreds of rounds. We show that despite the possibility of sorting, imitation or learning, female players persistently choose lower risk-return profiles than men. We argue that the observed gender differences in risk taking result from true preference differences rather than a gap in skill, confidence or beliefs.
Powerless Men and Agentic Women: Gender Bias in Hiring Decisions
Ann Hoover et al.
Sex Roles, forthcoming
We examined male power-roles as a potential moderator of gender bias in hiring decisions. Drawing from previous work on perceptions of agentic women and precarious manhood theory, we predicted that men in low-power roles may react more negatively to agentic women compared to men in high-power roles. In two experiments, male participants evaluated résumés from male and female job candidates applying for a managerial position. Across experiments, results suggest that lacking power may facilitate biased hiring decisions. U.S. college men assigned to (Experiment 1, n = 83) or primed (Experiment 2, n = 84) with a low-power role rated the female applicant as less hireable and recommended a lower salary for her compared to the male applicant. This difference did not occur in the high-power or baseline conditions. A meta-analysis combining the results of both experiments confirmed that gender bias was limited to the low-power condition. Results are discussed in terms of powerlessness as a masculinity threat that may have downstream consequences for women.
Why Do Women Earn Less Than Men? Evidence from Bus and Train Operators
Harvard Working Paper, November 2018
Even in a unionized environment, where work tasks are similar, hourly wages are identical, and tenure dictates promotions, female workers earn $0.89 on the male-worker dollar (weekly earnings). We use confidential administrative data on bus and train operators from the Massachusetts Bay Transportation Authority (MBTA) to show that the weekly earnings gap can be explained entirely by the workplace choices that women and men make. Women value time and flexibility more than men. Women take more unpaid time off using the Family Medical Leave Act (FMLA) and work fewer overtime hours than men. Men and women plan to work similar overtime hours when they are scheduled three months in advance, but men actually work nearly 50% more overtime hours than women. Women with dependents value time away from work more than do men with dependents. When selecting work schedules, women try to avoid weekend, holiday, and split shifts more than men. To avoid unfavorable work times, women prioritize their schedules over route safety and select routes with a higher probability of accidents. Women are less likely than men to game the scheduling system by trading off work hours at regular wages for overtime hours at premium wages. Conditional on seniority, which dictates choice sets, the weekly earnings gap can be explained entirely by differences in operator choices of hours, schedules, and routes.
Race-Specific Urban Wage Premia and the Black-White Wage Gap
Elizabeth Ananat, Shihe Fu & Stephen Ross
Journal of Urban Economics, November 2018, Pages 141-153
We establish a novel empirical fact about the black-white wage gap: looking both across and within metropolitan areas, increasing city size or employment density is associated with a larger black-white wage gap. The estimated effects represent between 9 and 18 percent of recent estimates of the black-white wage gap. Using a variety of techniques, we demonstrate that our within-city relationship is unlikely to be driven by racial differences in unobserved ability. Finally, we present evidence suggestive of a role for race-specific networks in explaining these differences in the black-white wage gap.
Information and the Persistence of the Gender Wage Gap; Early Evidence from California's Salary History Ban
University of Oregon Working Paper, November 2018
Reductions in wage disparities across race and gender have stagnated in the recent decades. Recent popular focus on these inequalities has led to demands for policy interventions to reduce pay gaps. The most recent legislation intended to improve wage equality prohibits employers from asking about previously earned salaries. The intent of this legislation is to redress persistent pay inequalities. Salary history bans (SHBs) have been implemented in varying degrees (public and private) in multiple cities and states. I use a synthetic control approach to measure the impact of a statewide SHB in California. After the passing of a statewide SHB, statewide female-male earnings ratios increased from 0.77 (where they have been stagnant for the last 12 years) to 0.81. Moreover, I find these results are driven by an increase of the earnings ratio in male-dominated industries.
Variation in women’s success across graduate economics programs: Qualitative and quantitative evidence
Leah Boustan & Andrew Langan
Journal of Economic Perspectives, forthcoming
We document wide and persistent variation in women’s representation and success across graduate programs in economics. Using new data on early career outcomes for recent graduates, including first job placement, publications and tenure, we rank (anonymized) departments on relative outcomes for women graduate students. We then conduct interviews with faculty and former students from five programs with better and worse relative outcomes. We find that schools with better outcomes for women also hire more women faculty, facilitate advisor-student contact, provide collegial research seminars, and are notable for senior faculty with awareness of gender issues. We offer our qualitative evidence as the first step in learning about “what works” in expanding women’s representation in economics.
Kanter’s Theory of Proportions: Organizational Demography and PhD Completion in Science and Engineering Departments
Research in Higher Education, December 2018, Pages 1059–1073
Increasing the size and diversity of the scientific and technological workforce is a national priority. Investments in policy and programmatic efforts toward increasing the representation of women in science and engineering fields have resulted in significant advances; however, a gender gap remains among PhDs and faculty in these fields. This study tests whether Kanter’s (Men and women of the corporation, Basic Books, New York, 1977) theory of proportions, which suggests that numerical representation of groups influence group dynamics and cultural context, applies to the proportion of female faculty and the probability that female doctoral students will complete their degrees in science and engineering. Using data from two research-intensive academic institutions, results show that female doctoral students are more likely to complete the degree in departments with higher proportions of female faculty. Further, female PhD students working with female faculty dissertation advisors are also more likely to complete the degree than female PhD students working with male faculty dissertation advisors. Departmental faculty sex ratios and whether their faculty advisor is male or female, however, have no effect on the completion probabilities of male PhD students. Consistent with Kanter’s theory, research findings illustrate the importance of organizational demography on the academic outcomes of PhD students, and provide support for initiatives and programs aimed at increasing the representation of female faculty in science and engineering.
Female Managers and Gender Disparities: The Case of Academic Department Chairs
Princeton Working Paper, October 2018
Appointing female managers is a common proposal to improve women’s representation and outcomes in the workplace, but it is unclear how well such policies accomplish these goals. Using newly-collected panel data on academic departments, I exploit variation in the timing of transitions between department chairs of different genders with a difference-in-differences research design. For faculty, I find female department chairs reduce gender gaps in publications and tenure for assistant professors and shrink the gender pay gap. Replacing a male chair with a female chair increases the number of female students among incoming graduate cohorts by ten percent with no evidence of a change in ability correlates for the average student.
The Paradox of Persistence: Explaining the Black-White Gap in Bachelor’s Degree Completion
Christina Ciocca Eller & Thomas DiPrete
American Sociological Review, December 2018, Pages 1171-1214
Bachelor’s degree (BA) completion is lower among black students than among white students. In this study, we use data from the Education Longitudinal Study of 2002 and the Integrated Postsecondary Education Data System, together with regression-based analytical techniques, to identify the primary sources of the BA completion gap. We find that black students’ lower academic and socioeconomic resources are the biggest drivers of the gap. However, we also find that black students are more likely to enroll in four-year colleges than are white students, given pre-college resources. We describe this dynamic as “paradoxical persistence” because it challenges Boudon’s well-known assertion that the secondary effect of educational decision-making should reinforce the primary effect of resource discrepancies. Instead, our results indicate that black students’ paradoxical persistence widens the race gap in BA completion while also narrowing the race gap in BA attainment, or the proportion of high school graduates to receive a BA. This narrowing effect on the BA attainment gap is as large or larger than the narrowing effect of black students’ “overmatch” to high-quality colleges, facilitated in part by affirmative action. Paradoxical persistence refocuses attention on black students’ individual agency as an important source of existing educational gains.
Social identity threat in interpersonal relationships: Activating negative stereotypes decreases social approach motivation
Sarah Martiny & Jana Nikitin
Journal of Experimental Psychology: Applied, forthcoming
Research has shown that social identity threat can have a broad variety of negative consequences. However, not much is known about the consequences of social identity threat on interpersonal relationships. In the present research, we hypothesize that experiencing social identity threat decreases people’s social approach motivation toward other people related to the stereotyped domain. Specifically, we manipulated social identity threat by activating negative stereotypes about women in math. As math is an important aspect of the academic self-concept, female university students who are confronted with a negative math stereotype should experience threat toward their identity as university students. We then tested whether this threat affected female students’ motivation to approach other university students and whether the effect was mediated by a reduced sense of belonging to the university. Data from 478 participants, assessed in three experimental (Study 1a: N = 79, Study 1b: N = 164, Study 2: N = 100) and one correlational study (Study 3: N = 135), mainly supported these hypotheses. We conclude that social identity threat can be detrimental to the quality of people’s social lives.
Sugar Daddy U: Human Capital Investment and the University-Based Supply of ‘Romantic Arrangements’
Applied Economics, forthcoming
To deal with the financial hardships associated with rising college tuition, many female college students in the U.S. are turning to risqué forms of financing human capital investments, such as agreeing to potentially lucrative ‘romantic arrangements’ with older males, referred to as ‘sugar daddies,’ through the largest Internet-based club in the industry. Yet despite this recent trend, there is a relative paucity of published academic research on the economics of such behaviour. Using data from the more than 220 nationally ranked (by U.S. News & World Report’s America’s Best Colleges) colleges and universities in the U.S., presents results from both Poisson and scaled Poisson estimation suggesting that large, high-cost universities that are located in larger cities or where unemployment rates are higher lead the nation in the number of female students choosing such romantic arrangements in order to fund higher education. Moreover, those institutions that are chosen by more physically attractive female students, and those that enroll a higher percentage of female students, are also generating greater numbers of female student entrants into the sugar daddy industry. Each of these findings has implications for the human capital literature and the growing body of academic literature on the economics of beauty.
Do Male Workers Prefer Male Leaders? An Analysis of Principals’ Effects on Teacher Retention
Aliza Husain, David Matsa & Amalia Miller
NBER Working Paper, November 2018
Using a 40-year panel of all public school teachers and principals in New York State, we explore how female principals affect rates of teacher turnover — an important determinant of school quality. We find that male teachers are about 12% more likely to leave their schools when they work under female principals than under male principals. In contrast, we find no such effects for female teachers. Furthermore, when male teachers request transfers, they are more likely to be to schools with male principals. These results suggest that opposition from male subordinates could inhibit female progress in leadership.
Competing with confidence: The ticket to labor market success for college-educated women
Linda Kamas & Anne Preston
Journal of Economic Behavior & Organization, November 2018, Pages 231-252
This study examines whether the female earnings gap results from gender differences in preferences for competition and confidence. We use laboratory experiments on college seniors to measure tastes for competition and confidence and then track these subjects’ labor market experiences in the early years after college. Women's compensation is positively correlated with preferences for competition coupled with confidence while men's compensation is not. Women who exhibit a taste to compete and are confident about their performance earn substantially more than other women and do not earn less than men. Further, enjoying competition or being confident alone is insufficient to raise compensation. Half of this female earnings’ effect is explained by college major and labor market controls, but even controlling for these characteristics, a higher taste for competition for the most confident women results in more than a 7% increase in compensation.
Particularism and racial mobility into privileged occupations
George Wilson et al.
Social Science Research, forthcoming
We assess whether the “particularistic mobility thesis”, the predominant theory used to explain African American/White differences in mobility dynamics into occupationally privileged positions in the American labor market is applicable across a greater range of occupational destinations than previously considered, and, if so, whether it captures a racialized “glass ceiling”. Findings from a 2009–2014 Panel Study of Income Dynamics sample of men support broadening the scope of theory. Specifically, across four white-collar and blue-collar privileged destinations, African Americans, relative to, Whites, have low rates of mobility and are restricted to relying on a circumscribed and formal mobility route that is structured by a traditional range of stratification-based causal factors, i.e., background socio-economic status, human capital and job/labor market characteristics. In addition, a racialized glass ceiling in mobility prospects emerges across destinations based on two criteria — income and supervisory authority. We discuss how the application of theory in this broader context enhances our understanding of race-based access to occupational privilege in contemporary America and sheds light on the immediate and longer-term patterns of racial stratification in the American labor market.