Understanding the Gender Pay Gap: What's Competition Got to Do with it?

Posted: 15 Nov 2010

See all articles by Alan Manning

Alan Manning

London School of Economics & Political Science (LSE) - Centre for Economic Performance (CEP)

Farzad Saidi

New York University (NYU)

Date Written: July 1, 2010

Abstract

A number of researchers have argued that men and women have different attitudes toward and behavioral responses to competition; that is, women are more likely to opt out of jobs in which performance pay is the norm. Laboratory experiments suggest that these gender differences are rather large. To check these hypotheses and findings against differences in the field, the authors use performance pay as an indicator of competition in the workplace and compare the gender gap not only in incidence of performance pay but also in earnings and work effort under these contracts. They find that although women are less likely than men to work under performance pay contracts, the gender gap is small. Furthermore, the effect of performance pay on earnings is modest and does not differ markedly by gender. Consequently, the authors argue, the ability of these competition hypotheses to explain the gender pay gap seems very limited.

Keywords: Performance Pay, Gender Pay Gap

JEL Classification: J16, J33

Suggested Citation

Manning, Alan and Saidi, Farzad, Understanding the Gender Pay Gap: What's Competition Got to Do with it? (July 1, 2010). Industrial and Labor Relations Review, Vol. 63, No. 4, 2010. Available at SSRN: https://ssrn.com/abstract=1709476

Alan Manning (Contact Author)

London School of Economics & Political Science (LSE) - Centre for Economic Performance (CEP) ( email )

Houghton Street
London WC2A 2AE
United Kingdom
(44 20) 7955 6078 (Phone)

Farzad Saidi

New York University (NYU) ( email )

Bobst Library, E-resource Acquisitions
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New York, NY 10003-711
United States

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