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

38 Pages Posted: 22 Nov 2014

See all articles by Stefano Gagliarducci

Stefano Gagliarducci

University of Rome, Tor Vergata - Faculty of Economics; Einaudi Institute for Economics and Finance (EIEF); IZA Institute of Labor Economics

Daniele Paserman

Boston University - Department of Economics; Hebrew University of Jerusalem; National Bureau of Economic Research (NBER); IZA Institute of Labor Economics

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.

Keywords: gender, firm performance, employer-employee data

JEL Classification: D22, J16, J70, M50

Suggested Citation

Gagliarducci, Stefano and Paserman, Daniele, The Effect of Female Leadership on Establishment and Employee Outcomes: Evidence from Linked Employer-Employee Data. IZA Discussion Paper No. 8647. Available at SSRN: https://ssrn.com/abstract=2529356

Stefano Gagliarducci (Contact Author)

University of Rome, Tor Vergata - Faculty of Economics ( email )

Via Columbia n.2
Rome, rome 00100
Italy

HOME PAGE: http://https://sites.google.com/site/stefanogagliarducci/

Einaudi Institute for Economics and Finance (EIEF) ( email )

Via Due Macelli, 73
Rome, 00187
Italy

IZA Institute of Labor Economics ( email )

P.O. Box 7240
Bonn, D-53072
Germany

Daniele Paserman

Boston University - Department of Economics ( email )

270 Bay State Road
Boston, MA 02215
United States

Hebrew University of Jerusalem

Mount Scopus
Jerusalem, IL Jerusalem 91905
Israel

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

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