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

77 Pages Posted: 19 Dec 2017 Last revised: 28 Nov 2022

See all articles by Tim Liu

Tim Liu

University of Utah - David Eccles School of Business

Christos Makridis

Stanford University; Columbia University - Columbia Business School; Arizona State University (ASU); Department of Veterans Affairs (VA)

Paige Ouimet

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

Elena Simintzi

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

Date Written: March 31, 2022

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. This result also holds more generally when examining all female-friendly non-wage benefits and is not present when looking at benefits which are gender-neutral. 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 Makridis, Christos and Ouimet, Paige and Simintzi, Elena, The Distribution of Non-Wage Benefits: Maternity Benefits and Gender Diversity (March 31, 2022). Kenan Institute of Private Enterprise Research Paper No. 3088067, Available at SSRN: https://ssrn.com/abstract=3088067 or http://dx.doi.org/10.2139/ssrn.3088067

Tim Liu

University of Utah - David Eccles School of Business ( email )

1645 E Campus Center Dr
Salt Lake City, UT 84112-9303
United States

Christos Makridis (Contact Author)

Stanford University ( email )

Stanford, CA 94305
United States

Columbia University - Columbia Business School ( email )

3022 Broadway
New York, NY 10027
United States

Arizona State University (ASU) ( email )

Farmer Building 440G PO Box 872011
Tempe, AZ 85287
United States

Department of Veterans Affairs (VA) ( email )

810 Vermont Avenue NW
Washington, DC 20420
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

Centre for Economic Policy Research (CEPR) ( email )

London
United Kingdom

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

McColl Building
Chapel Hill, NC 27599-3490
United States

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