DP13075 | Gender Wage Gap at the Top, Job Inflexibility and Product Market Competition

Publication Date

07/24/2018

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Abstract

Research show that women are disadvantaged in inflexible occupations. We show that this will imply that female managers are on average more skilled than male managers. Due to the higher hurdles faced by women, only the most skilled among them will pursue a management career. This implies that female managers will, on average, be more beneficial for the firm when product market competition is intense. Using detailed matched employee-employer data, we find that (i) more intense product market competition leads to relatively higher wages for female managers and (ii) the share of female managers is higher in firms in more competitive industries.