PSC Working Paper Series

Document Type

Working Paper

Date of this Version

1-1-2012

Comments

Madden, Janice. 2012. "Performance-Support Bias and the Gender Pay Gap among Stockbrokers." PSC Working Paper Series, PSC 12-04.

This paper was recently published as: Madden, Janice. 2012. "Performance-Support Bias and the Gender Pay Gap among Stockbrokers." Gender & Society 26(3): 488-518.

Abstract

Organizational mechanisms, and their contexts, leading to gender inequality among stockbrokers in two large brokerages are analyzed. Inequality is the result of gender differences in sales, as both firms use performance-based pay, paying entirely by commissions. This paper develops and tests whether performance-support bias, whereby women receive inferior sales support and sales assignments, causes the commissions gap. Newly available data on the brokerages’ internal transfers of accounts among brokers allows measurement of performance-support bias. Gender differences in the quality and quantity of transferred accounts provide a way to measure gender differences in the assignment of sales opportunities and support. Sales generated from internally transferred accounts, controlling for the accounts’ sales histories, provide a “natural experiment” testing for gender differences in sales capacities. The evidence for performance-support bias is: (1) women are assigned inferior accounts; and (2) women produce sales equivalent to men when given accounts with equivalent prior sales histories.

Keywords

Bonuses, Commission, Compensation, Consumer Discrimination, Earnings, Economics, Employees, Financial Services, Gender, Gender Inequality, Gender Pay Gap, Human Relations, Income, Inequality, Labor, Labor Relations, Men, Merit Based Pay, Organizational Dynamics, Organizational Policies, Organizations, Pay, Performance, Performance Based Pay, Performance Evaluations, Performance Rewards, Promotions, Salary Increases, Sex, Stockbrokers, Women

 

Date Posted: 12 June 2012