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Do women respond less to performance pay? Building evidence from multiple experiments

Author

Listed:
  • Bandiera, Oriana
  • Fischer, Gregory
  • Prat, Andrea
  • Ytsma, Erina

Abstract

Performance pay increases productivity but also earnings inequality. Can it contribute to the gender gap because women are less responsive? We provide answers by aggregating evidence from existing experiments on performance incentives with male and female subjects, regardless of whether they test for gender differences. Using a Bayesian hierarchical model we estimate both the average effect and heterogeneity across studies. We find that the gender response difference is close to zero and heterogeneity across studies is small, while performance pay increases output by 0.36 standard deviations on average. The data thus support agency theory for men and women alike.

Suggested Citation

  • Bandiera, Oriana & Fischer, Gregory & Prat, Andrea & Ytsma, Erina, 2021. "Do women respond less to performance pay? Building evidence from multiple experiments," LSE Research Online Documents on Economics 111841, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:111841
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    JEL classification:

    • R14 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Land Use Patterns
    • J01 - Labor and Demographic Economics - - General - - - Labor Economics: General

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