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The Effect of Female Leadership on Establishment and Employee Outcomes: Evidence from Linked Employer-Employee Data

Author

Listed:
  • Gagliarducci, Stefano

    (University of Rome Tor Vergata)

  • Paserman, M. Daniele

    (Boston University)

Abstract
In this paper we use a large linked employer-employee data set on German establishments between 1993 and 2012 to investigate how the gender composition of the top layer of management affects a variety of establishment and worker outcomes. We use two different measures to identify the gender composition of the top layer based on direct survey data: the fraction of women among top managers, and the fraction of women among working proprietors. We document the following facts: a) There is a strong negative association between the fraction of women in the top layer of management and several establishment outcomes, among them business volume, investment, total wage bill per worker, total employment, and turnover; b) Establishments with a high fraction of women in the top layer of management are more likely to implement female-friendly policies, such as providing childcare facilities or promoting and mentoring female junior staff; c) The fraction of women in the top layer of management is also negatively associated with employment and wages, both male and female, full-time and part-time. However, all of these associations vanish when we include establishment fixed effects and establishment-specific time trends. This reveals a substantial sorting of female managers across establishments: small and less productive establishments that invest less, pay their employees lower wages, but are more female-friendly are more likely to be led by women.

Suggested Citation

  • Gagliarducci, Stefano & Paserman, M. Daniele, 2014. "The Effect of Female Leadership on Establishment and Employee Outcomes: Evidence from Linked Employer-Employee Data," IZA Discussion Papers 8647, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp8647
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    References listed on IDEAS

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    4. Stefano Gagliarducci & M. Daniele Paserman, 2012. "Gender Interactions within Hierarchies: Evidence from the Political Arena," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 79(3), pages 1021-1052.
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    8. Claudia Goldin & Lawrence F. Katz & Ilyana Kuziemko, 2006. "The Homecoming of American College Women: The Reversal of the College Gender Gap," Journal of Economic Perspectives, American Economic Association, vol. 20(4), pages 133-156, Fall.
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    Cited by:

    1. Chiara Pronzato & Paola Profeta & Valeria Ferraro & Giulia Ferrari, 2016. "Gender Quotas: Challenging the Boards, Performance, and the Stock Market," Working Papers id:11411, eSocialSciences.
    2. Agata Maida & Andrea Weber, 2022. "Female Leadership and Gender Gap within Firms: Evidence from an Italian Board Reform," ILR Review, Cornell University, ILR School, vol. 75(2), pages 488-515, March.
    3. Thushyanthan Baskaran & Sonia Bhalotra & Brian Min & Yogesh Uppal, 2024. "Women legislators and economic performance," Journal of Economic Growth, Springer, vol. 29(2), pages 151-214, June.
    4. Giulia Ferrari & Valeria Ferraro & Paola Profeta & Chiara Pronzato, 2022. "Do Board Gender Quotas Matter? Selection, Performance, and Stock Market Effects," Management Science, INFORMS, vol. 68(8), pages 5618-5643, August.
    5. Baskaran, Thushyanthan & Bhalotra, Sonia R. & Min, Brian & Uppal, Yogesh, 2018. "Women Legislators and Economic Performance," IZA Discussion Papers 11596, Institute of Labor Economics (IZA).

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    More about this item

    Keywords

    gender; firm performance; employer-employee data;
    All these keywords.

    JEL classification:

    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination
    • J70 - Labor and Demographic Economics - - Labor Discrimination - - - General
    • M50 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - General

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