IZA DP No. 10788: Women in the Workplace and Management Practices: Theory and Evidence
published in: Susan L. Averett, Laura M. Argys and Saul D. Hoffman (eds.), Oxford Handbook on the Economics of Women, New York: OUP, 2018
We review recent studies on management practices and their consequences for women in the workplace. First, the High Performance Work System (HPWS) is associated with greater gender diversity in the workplace while there is little evidence that the HPWS reduces the gender pay gap. Second, work-life balance practices with limited face-to-face interactions with coworkers may hamper women’s career advancement. Third, individual incentive linking pay to objective performance may enhance gender diversity while individual incentive with subjective performance may have an opposite effect. Fourth, a rat race model with working hours as a signal of the worker’s commitment is a promising way to explain the gender gap in promotions. Fifth, corporate social responsibility practices may increase gender diversity. We temper the findings by identifying three major methodological challenges: (i) how to measure management practices; (ii) how to account for endogeneity of management practices; and (iii) how to minimize selection bias.