Gender differences in competition - Experimental studies

Despite substantial improvements over the past decades, there are still substantial gender differences on labor markets. A series of studies has shown that women are still lagging behind men in crucial issues such as wage levels or opportunities for career advancement. The disadvantaged position of women on labor markets is often attributed to differences in preferences, problems in combining family and career, or also to discrimination against women. A recent line of research has concentrated on another important factor that might explain gender differences on labor markets, namely the relatively stronger aversion of women towards competition. In a nutshell, the literature shows that women are less willing than men to become exposed to a competitive situation, even when they are equally qualified, and that men increase their performance under competitive pressure, while women don`t. These gender differences in competition and attitudes towards competition may then contribute to women having fewer promotion opportunities and subsequently lower wages than men. This project uses economic experiments to study the causes and consequences of these gender differences as well as possible interventions to promote women in tournaments. From a societal point of view, the weaker preference for competition of women may entail large efficiency costs if better qualified women are bypassed in filling positions due to their aversion against competition. Using controlled laboratory experiments we study whether the gender differences are driven by risk preferences or the strategic thinking and behavior of men and women. With respect to policy interventions that might promote women in competitions we study (a) affirmative action programs (that set particular quota of female winners in a tournament), (b) preferential treatment of women in case of equal qualifications with men, (c) repetition of a tournament if less women win the tournament than an exogenously imposed number specifies as benchmark, or (d) preferential treatment of women even if they perform worse than men. While policy intervention (a) has been studied before, interventions (b) to (d) have not been examined so far with respect to their effects on male and female beahvior. However, a systematic comparison of different policy interventions and their consequences is very important for evaluating different measures and implementing the most desirable ones. Contrary to the literature addressing intervention (a) this project does not only consider the effects of interventions (a) to (d) on behavior in tournaments, but we also consider the effects after a tournament. In order to do so we let groups of subjects work on a cooperative team task (with free-rider incentives) after they have had to compete earlier against each other (under the different interventions). In many companies there is competition for promotion between candidates which have later on (after resolving the promotion decision) have to work together again, even though at different levels of hierarchy. Hence, we check whether policy interventions for promoting women in tournaments may have undesirable side-effects later on. Taken together, the results of this project promise to be important for a better understanding of competitive behavior of men and women and how different interventions for the promotion of women may affect competitive behavior both during a tournament as well as after it. The insights gained from these studies promise to promote a better understanding of gender differences on labor markets.

Gender differences in competitiveness are one major source of unequal labor market outcomes for men and women concerning wages and promotions, for which reason this project has examined gender differences in competitiveness. Particular focus has been put on affirmative action policy interventions like Quotas, Preferential Treatment, or Repetition of the Competition unless a critical number of female winners is reached and how they affect male and female behavior in competition. The most important results of the project are published in a paper in Science (2012) where we find that, compared to a control treatment, (i) all interventions encourage women to compete more often, (ii) the efficiency in promoting the best candidates is at least equally good (because the best women are drawn into competition through interventions), and (iii) policy interventions even increase cooperation in a post-competition team task. The same results have also been replicated for children and teenagers (forthcoming in Experimental Economics) and not-yet finished work has investigated whether and under which conditions affirmative action policies emerge endogenously. Taken together, the project findings support the use of affirmative action policies.