Abstract
Traditional arguments against women as leaders suggest that women would not be extended the trust necessary for leadership and/or that women undermine their own bargaining position by extending too much trust to others. We examine data from a laboratory test in which pairs of subjects are given the task of negotiating a wage-labor agreement. We first derive the optimal contract offer for principals and response by agents. We find that men and women do not reach different bargaining outcomes. We also find that women in authority are perceived as more trustworthy than men with authority, and women are no more or less trusting than men of their superiors or subordinates. The perceived trust is not rooted in differential wage terms but is based on the negotiation setting. Thus, women are likely to be extended the trust necessary to lead and are not likely to produce outcomes that are significantly different from men.
Highlights
Traditional arguments against women as leaders suggest that women would not be extended the trust necessary for leadership and/or that women undermine their own bargaining position by extending too much trust to others
More than 50 years have passed since the passage of the Equal Pay Act of 1963, which prohibited unequal pay for “substantially equal” work, and the Civil Rights Act of 1964, which provided protection from wage discrimination based on race, color, sex, religion, and/or national origin
Male contractors report more trust for female owners than for male owners (Z = 1.653, two-tailed test). (Both results border on significance at the p = 0.10 level.) No other significant differences are apparent for trust of contractors by owners. These results suggest support for differential trust felt by contractors of owners based on the owner’s gender
Summary
Traditional arguments against women as leaders suggest that women would not be extended the trust necessary for leadership and/or that women undermine their own bargaining position by extending too much trust to others. Are there gender differences in negotiation behavior in principal-agent settings?
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