Working Paper: NBER ID: w22877
Authors: Luca Flabbi; Mario Macis; Andrea Moro; Fabiano Schivardi
Abstract: We investigate the effects of female executives on gender-specific wage distributions and firm performance. We find that female leadership has a positive impact at the top of the female wage distribution and a negative impact at the bottom. Moreover, the impact of female leadership on firm performance increases with the share of female workers. Our empirical strategy accounts for the endogeneity induced by the non-random assignment of executives to firms by including in the regressions firm fixed effects, by generating controls from a two-way fixed effects regression, and by building instruments based on regional trends. The empirical findings are consistent with a model of statistical discrimination where female executives are better equipped at interpreting signals of productivity from female workers. The evidence suggests substantial costs of under-representation of women at the top of the corporate hierarchy
Keywords: executives; gender; gender gap; firm performance; glass ceiling; statistical discrimination
JEL Codes: M5; M12; J7; J16
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| female leadership (J16) | higher wages for female workers at the top of the wage distribution (J31) |
| female leadership (J16) | lower wages for female workers at the bottom of the wage distribution (J31) |
| female leadership (J16) | firm performance (L25) |
| proportion of female workers (J21) | firm performance under female leadership (L25) |