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Glass Ceiling Effect and Earnings: The Gender Pay Gap in Managerial Positions in Germany

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Author Info
Elke Holst
Anne Busch

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Abstract

Although there are a variety of studies on the gender pay gap, only a few relate to managerial positions. The present study attempts to fill this gap. Managers in private companies in Germany are a highly selective group of women and men, who differ only marginally in their human capital endowments. The Oaxaca/Blinder decomposition shows that the gender pay gap in the gross monthly salary can hardly be explained using the human capital approach. Adding variables on gender-specific labor market segregation and dimensions of the household and family to the model allows more than two-thirds of the gender pay gap to be explained. However, taking selection effects in a managerial position into account (Heckman correction), the proportion explained decreases to only one-third. This reveals the real extent to which women are disadvantaged on the labor market. In addition, we observe not only that the wages in typical women¿s jobs are lower than in typical men¿s jobs but also that women are paid less than men in typical women¿s jobs. The two-thirds of the gender pay gap that remain unexplained represent the unobserved heterogeneity. This includes, for example, general societal and cultural conditions as well as structures and practices on the labor market and in companies that subject women to pay discrimination and pose an obstacle to them breaking the glass ceiling.

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Paper provided by DIW Berlin, The German Socio-Economic Panel (SOEP) in its series SOEPpapers with number 201.

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Length: 34 p.
Date of creation: 2009
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Handle: RePEc:diw:diwsop:diw_sp201

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Related research
Keywords: Gender pay gap; managerial positions; segregation; Oaxaca/Blinder decomposition; Heckman correction;

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Find related papers by JEL classification:
J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination
J2 - Labor and Demographic Economics - - Demand and Supply of Labor

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References listed on IDEAS
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  1. Phelps, Edmund S, 1972. "The Statistical Theory of Racism and Sexism," American Economic Review, American Economic Association, vol. 62(4), pages 659-61, September. [Downloadable!] (restricted)
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  3. Francine D. Blau & Lawrence M. Kahn, 2003. "Understanding International Differences in the Gender Pay Gap," Journal of Labor Economics, University of Chicago Press, vol. 21(1), pages 106-144, January. [Downloadable!]
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  4. Blau, Francine D & Kahn, Lawrence M, 1997. "Swimming Upstream: Trends in the Gender Wage Differential in 1980s," Journal of Labor Economics, University of Chicago Press, vol. 15(1), pages 1-42, January. [Downloadable!] (restricted)
  5. Bernd Fitzenberger & Astrid Kunze, 2005. "Vocational Training and Gender: Wages and Occupational Mobility among Young Workers," Oxford Review of Economic Policy, Oxford University Press, vol. 21(3), pages 392-415, Autumn.
  6. Wiji Arulampalam & Alison Booth & Mark L. Bryan, 2006. "Is There a Glass Ceiling over Europe? Exploring the Gender Pay Gap across the Wages Distribution," CEPR Discussion Papers 510, Centre for Economic Policy Research, Research School of Social Sciences, Australian National University. [Downloadable!]
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  7. Francine D. Blau & Lawrence M. Kahn, 2000. "Gender Differences in Pay," Journal of Economic Perspectives, American Economic Association, vol. 14(4), pages 75-99, Fall. [Downloadable!] (restricted)
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  8. Hinz, Thomas & Gartner, Hermann, 2005. "Lohnunterschiede zwischen Frauen und Männern in Branchen, Berufen und Betrieben," IAB Discussion Paper 200504, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]. [Downloadable!]
  9. Marianne Bertrand & Kevin F. Hallock, 2001. "The Gender gap in top corporate jobs," Industrial and Labor Relations Review, ILR Review, ILR School, Cornell University, vol. 55(1), pages 3-21, October.
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  10. Oaxaca, Ronald L. & Ransom, Michael R., 1994. "On discrimination and the decomposition of wage differentials," Journal of Econometrics, Elsevier, vol. 61(1), pages 5-21, March. [Downloadable!] (restricted)
  11. Markus Gmuer, 2006. "The Gendered Stereotype of the ?Good Manager? Sex Role Expectations towards Male and Female Managers," management revue. The International Review of Management Studies, Rainer Hampp Verlag, vol. 17(2), pages 104-121. [Downloadable!]
  12. Bernd Fitzenberger & Astrid Kunze, 2005. "Vocational Training and Gender: Wages and Occupational Mobility among Young Workers," IZA Discussion Papers 1766, Institute for the Study of Labor (IZA). [Downloadable!]
  13. Fitzenberger, Bernd & Kunze, Astrid, 2005. "Vocational Training and Gender: Wages and Occupational Mobility among young Workers," ZEW Discussion Papers 05-66, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research. [Downloadable!]
  14. Elke Holst, 2006. "Women in Managerial Positions in Europe: Focus on Germany," management revue. The International Review of Management Studies, Rainer Hampp Verlag, vol. 17(2), pages 122-142. [Downloadable!]
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