Gender Biases in Performance Evaluation: The Role of Beliefs versus Outcomes

65 Pages Posted: 14 Dec 2021 Last revised: 12 May 2022

See all articles by Nisvan Erkal

Nisvan Erkal

University of Melbourne - Faculty of Business and Economics

Lata Gangadharan

Monash University

Boon Han Koh

University of East Anglia (UEA) - School of Economics

Date Written: May 12, 2022

Abstract

We investigate whether gender distorts performance evaluation in environments where outcomes are determined by unobservable choices and luck. Evaluators form beliefs about leaders’ choices and make discretionary payment decisions. We find that while discretionary payments made to male leaders are determined by both outcomes and evaluators’ beliefs, those made to female leaders are determined by outcomes only. We label this new source of gender bias as the gender belief-outcome gap. Our findings imply that good outcomes are necessary for women to get bonuses, but men can receive bonuses for bad outcomes as long as evaluators hold them in high regard.

Keywords: Gender gaps, Performance evaluation, Biases in belief updating, Outcome bias, Social preferences, Laboratory experiments

JEL Classification: C92, D91, J71

Suggested Citation

Erkal, Nisvan and Gangadharan, Lata and Koh, Boon Han, Gender Biases in Performance Evaluation: The Role of Beliefs versus Outcomes (May 12, 2022). Available at SSRN: https://ssrn.com/abstract=3979701 or http://dx.doi.org/10.2139/ssrn.3979701

Nisvan Erkal

University of Melbourne - Faculty of Business and Economics ( email )

Victoria, 3010
Australia
+61 3 8344 3307 (Phone)
+61 3 8344 6899 (Fax)

HOME PAGE: http://www.nisvanerkal.net

Lata Gangadharan

Monash University ( email )

23 Innovation Walk
Wellington Road
Clayton, Victoria 3800
Australia

Boon Han Koh (Contact Author)

University of East Anglia (UEA) - School of Economics ( email )

3.06, Registry
University of East Anglia
Norwich, NR4 7TJ
United Kingdom

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