Do Female Executives Make a Difference? The Impact of Female Leadership on Gender Gaps and Firm Performance

55 Pages Posted: 5 Dec 2016 Last revised: 6 Jul 2023

See all articles by Luca Flabbi

Luca Flabbi

Georgetown University - Department of Economics; RES/IDB

Mario Macis

Johns Hopkins University - Carey Business School; IZA Institute of Labor Economics; National Bureau of Economic Research (NBER)

Andrea Moro

Vanderbilt University - College of Arts and Science - Department of Economics

Fabiano Schivardi

Luiss Guido Carli - Department of Economics and Finance; Einaudi Institute for Economics and Finance (EIEF); Centre for Economic Policy Research (CEPR)

Date Written: December 2016

Abstract

We investigate the effects of female executives on gender-specific wage distributions and firm performance. We find that female leadership has a positive impact at the top of the female wage distribution and a negative impact at the bottom. Moreover, the impact of female leadership on firm performance increases with the share of female workers. Our empirical strategy accounts for the endogeneity induced by the non-random assignment of executives to firms by including in the regressions firm fixed effects, by generating controls from a two-way fixed effects regression, and by building instruments based on regional trends. The empirical findings are consistent with a model of statistical discrimination where female executives are better equipped at interpreting signals of productivity from female workers. The evidence suggests substantial costs of under-representation of women at the top of the corporate hierarchy

Suggested Citation

Flabbi, Luca and Macis, Mario and Moro, Andrea and Schivardi, Fabiano, Do Female Executives Make a Difference? The Impact of Female Leadership on Gender Gaps and Firm Performance (December 2016). NBER Working Paper No. w22877, Available at SSRN: https://ssrn.com/abstract=2880316

Luca Flabbi (Contact Author)

Georgetown University - Department of Economics ( email )

Washington, DC 20057
United States

RES/IDB ( email )

1300 New York Ave., NW
Washington, DC 20577
United States

Mario Macis

Johns Hopkins University - Carey Business School ( email )

100 International Drive
Baltimore, MD 21202
United States

IZA Institute of Labor Economics ( email )

P.O. Box 7240
Bonn, D-53072
Germany

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Andrea Moro

Vanderbilt University - College of Arts and Science - Department of Economics ( email )

Box 1819 Station B
Nashville, TN 37235
United States

Fabiano Schivardi

Luiss Guido Carli - Department of Economics and Finance ( email )

Viale Romania 32
Rome, Rome 00187
Italy

Einaudi Institute for Economics and Finance (EIEF) ( email )

Via Due Macelli, 73
Rome, 00187
Italy

Centre for Economic Policy Research (CEPR) ( email )

London
United Kingdom

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