The Salary Taboo: Privacy Norms and the Diffusion of Information

58 Pages Posted: 10 Nov 2018

See all articles by Zoe Cullen

Zoe Cullen

Harvard Business School

Ricardo Perez-Truglia

University of California, Los Angeles (UCLA); National Bureau of Economic Research (NBER)

Multiple version iconThere are 2 versions of this paper

Date Written: October 2, 2018

Abstract

The diffusion of salary information has important implications for labor markets, such as for wage discrimination policies and collective bargaining. Despite the widespread view that transmission of salary information is imperfect and unequal, there is little direct evidence on the magnitude and sources of these frictions. We conduct a field experiment with 752 employees at a multi billion-dollar corporation to address these questions. We provide evidence of significant frictions in how employees search for and share salary information and suggestive evidence that these frictions are due to privacy norms. We do not find any significant differences in information frictions between female and male employees.

Keywords: Information Diffusion, Salary, Privacy, Inequality, Transparency, Gender

JEL Classification: D83, D84, D91, C93, J16, J31, M12

Suggested Citation

Cullen, Zoe and Perez-Truglia, Ricardo, The Salary Taboo: Privacy Norms and the Diffusion of Information (October 2, 2018). Available at SSRN: https://ssrn.com/abstract=3258907 or http://dx.doi.org/10.2139/ssrn.3258907

Zoe Cullen

Harvard Business School ( email )

Soldiers Field Road
Morgan 270C
Boston, MA 02163
United States

HOME PAGE: http://www.hbs.edu/faculty/Pages/profile.aspx?facId=879471

Ricardo Perez-Truglia (Contact Author)

University of California, Los Angeles (UCLA) ( email )

405 Hilgard Avenue
Box 951361
Los Angeles, CA 90095
United States

HOME PAGE: http://www.anderson.ucla.edu/perez-truglia

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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