We investigate the impact of professional networks on men's and women's earnings, using a dataset of European and North American executives. The size of an individual's network of influential former colleagues has a large positive association with remuneration, with an elasticity of around 21%. However, controlling for unobserved heterogeneity using various fixed effects as well as a placebo technique, we find that the real causal impact of networks is barely positive for men and significantly lower for women. We provide suggestive evidence indicating that the apparent discrimination against women is due to two factors: first, both men and women are helped more by own-gender than other-gender connections, and men have more of these than women do. Second, a subset of employers we identify as ‘female friendly firms’ recruit more women but reward networks less than other firms.
Executive compensation; Gender wage gap; Placebo technique; professional networks;
- J16: Economics of Gender • Non-labor Discrimination
- J31: Wage Level and Structure • Wage Differentials
- J33: Compensation Packages • Payment Methods
- M12: Personnel Management • Executives; Executive Compensation
Journal of Institutional Economics, février 2022, p. 1–20