Selection into Leadership and Dishonest Behavior of Leaders: A Gender Experiment

Kerstin Grosch,Stephan Müller,Holger Andreas Rau,Lilia Zhurakhovska

doi:10.2139/ssrn.3682014

Abstract

Leaders often have to weigh ethical against monetary consequences. Such situations may evoke psychological costs from being dishonest and dismissing higher monetary benefits for others. In a within-subjects experiment, we analyze such a dilemma. We first measure individual dishonest behavior when subjects report the outcome of a die roll, which determines their payoffs. Subsequently, they act as leaders and report payoffs for a group including themselves. In our main treatment, subjects can apply for leadership, whereas in the control treatment, we assign leadership randomly. Results reveal that women behave more dishonestly as leaders while men behave similarly in both the individual and the group decision. For female leaders, we find that sorting into leadership is not related to individual honesty preferences. In the control we find that female leaders do not increase dishonesty. A followup study reveals that female leaders become more dishonest after assuming leadership, as they align dishonest behavior with their belief on group members' honesty preferences.

Highlights

Leadership behavior and selection into leadership positions play a key role for the performance of teams in firms, sport teams, or political parties (Peterson et al, 2012; Lorinkova et al, 2013; Bandiera et al, 2020)
We find that sorting into leadership is not related to individual honesty preferences
Since leadership decisions may require that they bend rules at times when there are social, monetary, or other incentives in place, differences in dishonest behavior may be another piece of the puzzle explaining gender differences in leadership sorting and behavior

Summary

Introduction

Leadership behavior and selection into leadership positions play a key role for the performance of teams in firms, sport teams, or political parties (Peterson et al, 2012; Lorinkova et al, 2013; Bandiera et al, 2020). Besides historical gender-role attitudes (Alesina et al, 2013), gender differences in preferences (Croson and Gneezy, 2009) are a potential explanation for why women partly sort out. That is, they lack risk tolerance, confidence, or competitive preferences, as compared to men (e.g., Barber and Odean, 2001; Eckel and Grossman, 2002; Niederle and Vesterlund, 2007; Ertac and Gurdal, 2012; Alan and Ertac, 2019; Alan et al, 2020). Since leadership decisions may require that they bend rules at times when there are social, monetary, or other incentives in place, differences in dishonest behavior may be another piece of the puzzle explaining gender differences in leadership sorting and behavior

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