The Distribution of Non-Wage Benefits: Maternity Benefits and Gender Diversity

61 Pages Posted: 19 Dec 2017 Last revised: 18 Jun 2021

See all articles by Tim Liu

Tim Liu

University of Utah; affiliation not provided to SSRN

Christos Makridis

Stanford University

Paige Ouimet

University of North Carolina (UNC) at Chapel Hill - Kenan-Flagler Business School

Elena Simintzi

University of North Carolina Kenan-Flagler Business School; Centre for Economic Policy Research (CEPR)

Date Written: June 18, 2021

Abstract

Why do firms offer non-wage compensation instead of the equivalent amount in financial compensation? We argue that firms use non-wage benefits, specifically female-friendly benefits such as maternity leave, to increase gender diversity by efficiently attracting women. Using Glassdoor data, we show that firms offer higher quality maternity leave benefits in labor markets where female talent is relatively scarce. As a result, we show that firms offering better quality maternity leave benefits are more gender diverse. Moreover, using staggered adoption of state laws, we show that voluntary provision of these benefits can increase firm value.

Keywords: Non-Wage Compensation, Compensation, Corporate Finance

Suggested Citation

Liu, Tim and Liu, Tim and Makridis, Christos and Ouimet, Paige and Simintzi, Elena, The Distribution of Non-Wage Benefits: Maternity Benefits and Gender Diversity (June 18, 2021). Available at SSRN: https://ssrn.com/abstract=3088067 or http://dx.doi.org/10.2139/ssrn.3088067

Tim Liu

University of Utah ( email )

1645 E. Campus Center
Salt Lake City, UT 84112
United States

affiliation not provided to SSRN

Christos Makridis (Contact Author)

Stanford University ( email )

Stanford, CA 94305
United States

Paige Ouimet

University of North Carolina (UNC) at Chapel Hill - Kenan-Flagler Business School ( email )

McColl Building
Chapel Hill, NC 27599-3490
United States

Elena Simintzi

University of North Carolina Kenan-Flagler Business School ( email )

McColl Building, Room 4200B
300 Kenan Center Drive
Chapel Hill, NC 27599-3490
United States

Centre for Economic Policy Research (CEPR) ( email )

London
United Kingdom

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