Working Paper: CEPR ID: DP10924
Authors: Ernesto Reuben; Paola Sapienza; Luigi Zingales
Abstract: Using an incentivized measure of test for competition, this paper investigates whether this taste explains subsequent gender differences in earnings and industry choice in a sample of high-ability MBA graduates. We find that ?competitive? individuals earn 9% more than their less competitive counterparts do. Moreover, gender differences in taste for competition explain around 10% of the overall gender gap. We also find that competitive individuals are more likely to work in high-paying industries nine years later, which suggests that the relation between taste for competition and earnings persists in the long run. Lastly, we find that the effect of taste for competition emerges over time when MBAs and firms interact with each other.
Keywords: Business; Career; Gender Differences; Gender Gap; Taste for Competition
JEL Codes: C93; D81; D84; I21; J16
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| taste for competition (D41) | earnings (J31) |
| taste for competition (D41) | industry selection (L89) |
| gender differences in taste for competition (C72) | gender earnings gap (J31) |
| competitive individuals (L13) | likelihood of working in high-paying industries (J31) |
| taste for competition (D41) | likelihood of starting and remaining in consulting and finance (G24) |