The Origins and Real Effects of the Gender Gap: Evidence from CEOs' Formative Years

Review of Financial Studies

99 Pages Posted: 7 May 2018 Last revised: 20 Jul 2020

See all articles by Ran Duchin

Ran Duchin

Boston College - Carroll School of Management

Mikhail Simutin

University of Toronto - Rotman School of Management

Denis Sosyura

Arizona State University

Date Written: July 17, 2020

Abstract

Using individual census records, we provide novel evidence on CEOs’ socioeconomic backgrounds and study their role in investment decisions. Male CEOs allocate more investment capital to male than female division managers. This gender gap is driven by CEOs who grew up in male-dominated families where the father was the only income earner and had more education than the mother. The gender gap also increases for CEOs who attended all-male high schools and grew up in neighborhoods with greater gender inequality. The effect of gender on capital budgeting introduces frictions and erodes investment efficiency.

Keywords: CEO, gender, family descent, formative years

JEL Classification: D91, G30, G31, G40, J16, J71

Suggested Citation

Duchin, Ran and Simutin, Mikhail and Sosyura, Denis, The Origins and Real Effects of the Gender Gap: Evidence from CEOs' Formative Years (July 17, 2020). Review of Financial Studies, Available at SSRN: https://ssrn.com/abstract=3171292 or http://dx.doi.org/10.2139/ssrn.3171292

Ran Duchin

Boston College - Carroll School of Management ( email )

140 Commonwealth Avenue
Chestnut Hill, MA 02467
United States

Mikhail Simutin

University of Toronto - Rotman School of Management ( email )

105 St. George Street
Toronto, Ontario M5S 3E6 M5S1S4
Canada

HOME PAGE: http://www.rotman.utoronto.ca/simutin

Denis Sosyura (Contact Author)

Arizona State University ( email )

Tempe, AZ 85287-3706
United States

HOME PAGE: http://www.public.asu.edu/~dsosyura/

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