1932
0
  1. Home
  2. A-Z Publications
  3. Annual Review of Economics
  4. Volume 15, 2023
  5. Article

Annual Review of Economics

Volume 15, 2023

Gender Differences in Negotiation: Can Interventions Reduce the Gap?

Abstract

Gender differences in negotiation are seen as contributing to the persistent gender gaps in labor market outcomes. We review the literature on interventions aiming to mute differences in negotiation and assess their effectiveness in reducing the gender pay gap. We present research on initiatives that aspire to increase how often and how women negotiate, as well as institutional changes that ban negotiations, ban requests for employee salary history, and improve wage transparency. Along with reviewing evidence on the effectiveness of these initiatives, we point to unintended consequences that warrant caution at implementation. The review makes clear that initial efforts to push women to negotiate more like men have shifted to alter instead the conditions of the negotiation. This shift results not only from wanting to consider policies that “fix the institutions” rather than “fixing the women,” but also from evidence that these interventions are more successful in securing pay equity.

Keyword(s): ban, bargaining, lean in, negotiation training, salary history, transparency
Loading

Article metrics loading...

/content/journals/10.1146/annurev-economics-092022-115353
2023-09-13
2024-04-30
Loading full text...

Full text loading...

/deliver/fulltext/economics/15/1/annurev-economics-092022-115353.html?itemId=/content/journals/10.1146/annurev-economics-092022-115353&mimeType=html&fmt=ahah

Literature Cited

  1. Agan A, Cowgill B, Gee LK. 2020. Do workers comply with salary history bans? A survey on voluntary disclosure, adverse selection, and unraveling. AEA Pap. Proc. 110:215–19
     [Google Scholar]
  2. Agan A, Cowgill B, Gee LK. 2022. Salary history and employer demand: evidence from a two-sided audit Work. Pap. Rutgers Univ. New Brunswick, NJ:
  3. Agan A, Starr S. 2018. Ban the box, criminal records, and racial discrimination: a field experiment. Q. J. Econ. 133:191–235
     [Google Scholar]
  4. Amanatullah ET, Morris MW. 2010. Negotiating gender roles: Gender differences in assertive negotiating are mediated by women's fear of backlash and attenuated when negotiating on behalf of others. J. Pers. Soc. Psychol. 98:256–67
     [Google Scholar]
  5. Amanatullah ET, Tinsley CH. 2013. Punishing female negotiators for asserting too much… or not enough: exploring why advocacy moderates backlash against assertive female negotiators. Organ. Behav. Hum. Decis. Process. 120:110–22
     [Google Scholar]
  6. Andersen S, Ertac S, Gneezy U, List JA, Maximiano S. 2018. On the cultural basis of gender differences in negotiation. Exp. Econ. 21:757–78
     [Google Scholar]
  7. Andersen S, Marx J, Nielsen KM, Vesterlund L. 2021. Gender differences in negotiation: evidence from real estate transactions. Econ. J. 131:2304–32
     [Google Scholar]
  8. Andreoni J, Vesterlund L. 2001. Which is the fair sex? Gender differences in altruism. Q. J. Econ. 116:293–312
     [Google Scholar]
  9. Arnold D, Quach S, Taska B. 2022. The impact of pay transparency in job postings on the labor market Work. Pap. Univ. Calif. San Diego:
  10. Arnold SH, McAuliffe K. 2021. Children show a gender gap in negotiation. Psychol. Sci. 32:153–58
     [Google Scholar]
  11. Ashraf N, Bau N, Low C, McGinn K. 2020. Negotiating a better future: how interpersonal skills facilitate intergenerational investment. Q. J. Econ. 135:1095–151
     [Google Scholar]
  12. Ayres I. 1991. Fair driving: gender and race discrimination in retail car negotiations. Harv. Law Rev. 104:817–72
     [Google Scholar]
  13. Ayres I. 1995. Further evidence of discrimination in new car negotiations and estimates of its cause. Mich. Law Rev. 94:109–47
     [Google Scholar]
  14. Ayres I, Siegelman P. 1995. Race and gender discrimination in bargaining for a new car. Am. Econ. Rev. 85:304–21
     [Google Scholar]
  15. Azmat G, Petrongolo B. 2014. Gender and the labor market: What have we learned from field and lab experiments?. Labour Econ. 30:32–40
     [Google Scholar]
  16. Babcock L, Gelfand M, Small D, Stayn H. 2006. Gender differences in the propensity to initiate negotiations. Social Psychology and Economics MZD De Cremer, JK Murnighan 239–59. New York: Lawrence Erlbaum
     [Google Scholar]
  17. Babcock L, Laschever S. 2003. Women Don't Ask: Negotiation and the Gender Divide Princeton, NJ: Princeton Univ. Press
  18. Babcock L, Recalde MP, Vesterlund L, Weingart L. 2017. Gender differences in accepting and receiving requests for tasks with low promotability. Am. Econ. Rev. 107:714–47
     [Google Scholar]
  19. Baker M, Halberstam Y, Kroft K, Mas A, Messacar D. 2023. Pay transparency and the gender gap. Am. Econ. J. Appl. Econ. 15:157–83
     [Google Scholar]
  20. Bamieh O, Ziegler L. 2022. Can wage transparency alleviate gender sorting in the labor market? IZA Discuss. Pap. 15363 Inst. Labor Econ. Bonn, Ger:.
  21. Barach MA, Horton JJ. 2021. How do employers use compensation history? Evidence from a field experiment. J. Labor. Econ. 39:193–218
     [Google Scholar]
  22. Barron LA. 2003. Ask and you shall receive? Gender differences in negotiators' beliefs about requests for a higher salary. Hum. Relat. 56:635–62
     [Google Scholar]
  23. Bear JB, Babcock L. 2017. Negotiating femininity: Gender-relevant primes improve women's economic performance in gender role incongruent negotiations. Psychol. Women Q. 41:163–74
     [Google Scholar]
  24. Bennedsen M, Simintzi E, Tsoutsoura M, Wolfenzon D. 2022. Do firms respond to gender pay gap transparency?. J. Finance 77:2051–91
     [Google Scholar]
  25. Bertrand M 2011. New perspectives on gender. Handbook of Labor Economics, Vol. 4A D Card, O Ashenfelter 1543–90. Amsterdam: Elsevier
     [Google Scholar]
  26. Bessen J, Meng C, Denk E. 2021. Perpetuating inequality: what salary history bans reveal about wages Work. Pap. Boston Univ. Boston, MA:
  27. Biasi B, Sarsons H. 2021. Information, confidence, and the gender gap in bargaining. AEA Pap. Proc. 111:174–78
     [Google Scholar]
  28. Biasi B, Sarsons H. 2022. Flexible wages, bargaining, and the gender gap. Q. J. Econ. 137:215–66
     [Google Scholar]
  29. Blundell J. 2021. Wage responses to gender pay gap reporting requirements Discuss. Pap. 1750 Cent. Econ. Perform., Lond. Sch. Econ. London:
  30. Böheim R, Gust S. 2021. The Austrian pay transparency law and the gender wage gap IZA Discuss. Pap. 14206 Inst. Labor Econ. Bonn, Ger:.
  31. Borghans L, Heckman JJ, Golsteyn BH, Meijers H. 2009. Gender differences in risk aversion and ambiguity aversion. J. Eur. Econ. Assoc. 7:649–58
     [Google Scholar]
  32. Bowles HR 2013. Psychological perspectives on gender in negotiation. The SAGE Handbook of Gender and Psychology MK Ryan, NR Branscombe 465–83. London: SAGE
     [Google Scholar]
  33. Bowles HR, Babcock L. 2013. How can women escape the compensation negotiation dilemma? Relational accounts are one answer. Psychol. Women Q. 37:80–96
     [Google Scholar]
  34. Bowles HR, Babcock L, Lai L. 2007. Social incentives for gender differences in the propensity to initiate negotiations: Sometimes it does hurt to ask. Organ. Behav. Hum. Decis. Process. 103:84–103
     [Google Scholar]
  35. Bowles HR, Babcock L, McGinn KL. 2005. Constraints and triggers: situational mechanics of gender in negotiation. J. Pers. Soc. Psychol. 89:951–65
     [Google Scholar]
  36. Bowles HR, Gelfand M. 2010. Status and the evaluation of workplace deviance. Psychol. Sci. 21:49–54
     [Google Scholar]
  37. Bowles HR, McGinn KL. 2008. Gender in job negotiations: a two-level game. Negot. J. 24:393–410
     [Google Scholar]
  38. Bowles HR, Thomason B, Macias-Alonso I. 2022. When gender matters in organizational negotiations. Annu. Rev. Organ. Psychol. Organ. Behav. 9:199–223
     [Google Scholar]
  39. Breza E, Kaur S, Shamdasani Y. 2018. The morale effects of pay inequality. Q. J. Econ. 133:611–63
     [Google Scholar]
  40. Brütt K, Yuan H. 2022. Pitfalls of pay transparency: evidence from the lab and the field Discuss. Pap. TI 2022-055/I Tinbergen Inst. Amsterdam:
  41. Bursztyn L, Fujiwara T, Pallais A. 2017.. “ Acting wife”: marriage market incentives and labor market investments. Am. Econ. Rev. 107:3288–319
     [Google Scholar]
  42. Busse MR, Israeli A, Zettelmeyer F. 2017. Repairing the damage: the effect of price knowledge and gender on auto repair price quotes. J. Mark. Res. 54:75–95
     [Google Scholar]
  43. Card D, Cardoso AR, Kline P. 2016. Bargaining, sorting, and the gender wage gap: quantifying the impact of firms on the relative pay of women. Q. J. Econ. 131:633–86
     [Google Scholar]
  44. Card D, Mas A, Moretti E, Saez E. 2012. Inequality at work: the effect of peer salaries on job satisfaction. Am. Econ. Rev. 102:2981–3003
     [Google Scholar]
  45. Castillo M, Petrie R, Torero M, Vesterlund L. 2013. Gender differences in bargaining outcomes: a field experiment on discrimination. J. Public Econ. 99:35–48
     [Google Scholar]
  46. Chotiputsilp B, Kim T. 2021. Can negotiation training help close the gender pay gap? Work. Pap. Erasmus Univ. Rotterdam Rotterdam, Neth.:
  47. Cowgill B, Agan AY, Gee L. 2023. The gender disclosure gap: Salary history bans unravel when men volunteer their income. Work. Pap. Columbia Univ. New York:
  48. Croson R, Gneezy U. 2009. Gender differences in preferences. J. Econ. Lit. 47:448–74
     [Google Scholar]
  49. Cullen ZB. 2023. Is pay transparency good? NBER Work. Pap. 31060
  50. Cullen ZB, Pakzad-Hurson B. 2023. Equilibrium effects of pay transparency. Econometrica 91:765–802
     [Google Scholar]
  51. Cullen ZB, Perez-Truglia R. 2022. How much does your boss make? The effects of salary comparisons. J. Political Econ. 130:766–822
     [Google Scholar]
  52. Cullen ZB, Perez-Truglia R. 2023a. The old boys' club: schmoozing and the gender gap. Am. Econ. Rev. In press
    [Google Scholar]
  53. Cullen ZB, Perez-Truglia R. 2023b. The salary taboo: privacy norms and the diffusion of information. J. Public Econ. 222:104890
     [Google Scholar]
  54. Dannals JE, Zlatev JJ, Halevy N, Neale MA. 2021. The dynamics of gender and alternatives in negotiation. J. Appl. Psychol. 106:1655–72
     [Google Scholar]
  55. Davis J, Ouimet P, Wang X. 2022. Hidden performance: salary history bans and the gender pay gap. Rev. Corp. Finance Stud. 11:511–53
     [Google Scholar]
  56. Dittrich M, Knabe A, Leipold K. 2014. Gender differences in experimental wage negotiations. Econ. Inq. 52:862–73
     [Google Scholar]
  57. Doleac JL, Hansen B. 2017. Moving to job opportunities? The effect of “ban the box” on the composition of cities. Am. Econ. Rev. 107:556–59
     [Google Scholar]
  58. Dreber A, Heikensten E, Säve-Söderbergh J. 2022. Why do women ask for less?. Labour Econ. 78:102204
     [Google Scholar]
  59. Duchini E, Simion S, Turrell A. 2022. Pay transparency and gender equality CAGE Work. Pap. 482 Univ. Warwick Coventry, UK:
  60. Eckel C, De Oliveira AC, Grossman PJ. 2008. Gender and negotiation in the small: Are women (perceived to be) more cooperative than men?. Negot. J. 24:429–45
     [Google Scholar]
  61. Eckel CC, Grossman PJ. 2001. Chivalry and solidarity in ultimatum games. Econ. Inq. 39:171–88
     [Google Scholar]
  62. Enwemeka Z. 2016. To close the wage gap, Boston hopes salary negotiation workshops will create a culture shift. WBUR Aug 26. https://www.wbur.org/news/2016/08/26/boston-wage-gap-salary-workshops
    [Google Scholar]
  63. Exley CL, Niederle M, Vesterlund L. 2020. Knowing when to ask: the cost of leaning in. J. Political Econ. 128:816–54
     [Google Scholar]
  64. Frimmel W, Schmidpeter B, Wiesinger R, Winter-Ebmer R. 2022. Mandatory wage posting, bargaining and the gender wage gap Work. Pap. Johannes Kepler Univ. Linz Linz, Austria:
  65. Gago A. 2020. Confrontation costs in negotiations: bargaining under the veil of a screen Work. Pap. Torcuato Di Tella Univ. Buenos Aires:
  66. Gamage DDK, Kavetsos G, Mallick S, Sevilla A. 2020. Pay transparency initiative and gender pay gap: evidence from research-intensive universities in the UK. IZA Discuss Pap. 13635 Inst. Labor Econ. Bonn, Ger:.
     [Google Scholar]
  67. Gihleb R, Landsman R, Vesterlund L. 2023. The effect of work assignment on compensation and negotiation Work. Pap. Univ. Pittsburgh Pittsburgh, PA:
  68. Gneezy U, Niederle M, Rustichini A. 2003. Performance in competitive environments: gender differences. Q. J. Econ. 118:1049–74
     [Google Scholar]
  69. Greig F. 2008. Propensity to negotiate and career advancement: evidence from an investment bank that women are on a “slow elevator. .” Negot. J. 24:495–508
     [Google Scholar]
  70. Gulyas A, Seitz S, Sinha S. 2023. Does pay transparency affect the gender wage gap? Evidence from Austria. Am. Econ. J. Econ. Policy 15:236–55
     [Google Scholar]
  71. Hall RE, Krueger AB. 2012. Evidence on the incidence of wage posting, wage bargaining, and on-the-job search. Am. Econ. J. Macroecon. 4:56–67
     [Google Scholar]
  72. Hansen B, McNichols D. 2020. Information and the persistence of the gender wage gap: early evidence from California's salary history ban NBER Work. Pap. 27054
  73. Hernandez-Arenaz I, Iriberri N. 2018. Women ask for less (only from men): evidence from bargaining in the field. J. Econ. Behav. Organ. 152:192–214
     [Google Scholar]
  74. Hernandez-Arenaz I, Iriberri N. 2019. A review of gender differences in negotiation. Oxford Research Encyclopedia of Economics and Finance Oxford, UK: Oxford Univ. Press https://doi.org/10.1093/acrefore/9780190625979.013.464
    [Crossref] [Google Scholar]
  75. Hernandez-Arenaz I, Iriberri N. 2023. Gender differences in alternating-offer bargaining: an experimental study. Exp. Econ. 2023: https://doi.org/10.1007/s10683-023-09796-9
    [Google Scholar]
  76. Khanna S. 2020. Salary history bans and wage bargaining: experimental evidence. Labour Econ. 65:101853
     [Google Scholar]
  77. Kray LJ. 2015. The best way to eliminate the gender pay gap? Ban salary negotiations. Washington Post May 21
    [Google Scholar]
  78. Kray LJ, Galinsky AD, Thompson L. 2002. Reversing the gender gap in negotiations: an exploration of stereotype regeneration. Organ. Behav. Hum. Decis. Process. 87:386–409
     [Google Scholar]
  79. Kray LJ, Gelfand MJ. 2009. Relief versus regret: the effect of gender and negotiating norm ambiguity on reactions to having one's first offer accepted. Soc. Cogn. 27:418–36
     [Google Scholar]
  80. Kugler KG, Reif JA, Kaschner T, Brodbeck FC. 2018. Gender differences in the initiation of negotiations: a meta-analysis. Psychol. Bull. 144:198–222
     [Google Scholar]
  81. Leibbrandt A, List JA. 2015. Do women avoid salary negotiations? Evidence from a large-scale natural field experiment. Manag. Sci. 61:2016–24
     [Google Scholar]
  82. Li CH, Zafar B. 2023. Ask and you shall receive? Gender differences in regrades in college. Am. Econ. J. Econ. Policy 15:359–94
     [Google Scholar]
  83. List JA. 2004. The nature and extent of discrimination in the marketplace: evidence from the field. Q. J. Econ. 119:49–89
     [Google Scholar]
  84. Luttmer EF. 2005. Neighbors as negatives: relative earnings and well-being. Q. J. Econ. 120:963–1002
     [Google Scholar]
  85. Maitra P, Neelim A, Tran C. 2021. The role of risk and negotiation in explaining the gender wage gap. J. Econ. Behav. Organ. 191:1–27
     [Google Scholar]
  86. Major B, McFarlin DB, Gagnon D. 1984. Overworked and underpaid: on the nature of gender differences in personal entitlement. J. Pers. Soc. Psychol. 47:1399–412
     [Google Scholar]
  87. Mas A. 2017. Does transparency lead to pay compression?. J. Political Econ. 125:1683–721
     [Google Scholar]
  88. Mask J. 2021. Salary history bans and healing scars from past recessions Work. Pap. Temple Univ. Philadelphia, PA:
  89. Mazei J, Hüffmeier J, Freund PA, Stuhlmacher AF, Bilke L, Hertel G. 2015. A meta-analysis on gender differences in negotiation outcomes and their moderators. Psychol. Bull. 141:85–104
     [Google Scholar]
  90. Mazei J, Mertes M, Hüffmeier J. 2020. Strategies aimed at reducing gender differences in negotiation are perceived by women as ineffective. Sex Roles 83:580–94
     [Google Scholar]
  91. McKelway M. 2021. Women's employment in India: intra-household and intra-personal constraints Work. Pap. Dartmouth Hanover, NH:
  92. Miller CC. 2018. How a common interview question hurts women. New York Times May 1
    [Google Scholar]
  93. Niederle M. 2016. Gender. The Handbook of Experimental Economics JH Kagel, AE Roth 481–562. Princeton, NJ: Princeton Univ. Press
     [Google Scholar]
  94. Niederle M, Vesterlund L. 2007. Do women shy away from competition? Do men compete too much?. Q. J. Econ. 122:1067–101
     [Google Scholar]
  95. Niederle M, Vesterlund L. 2008. Gender differences in competition. Negot. J. 24:447–63
     [Google Scholar]
  96. Niederle M, Vesterlund L. 2011. Gender and competition. Annu. Rev. Econ. 3:601–30
     [Google Scholar]
  97. Noguchi Y. 2018. More employers avoid legal minefield by not asking about pay history. NPR May 3
    [Google Scholar]
  98. Obloj T, Zenger T. 2022. The influence of pay transparency on (gender) inequity, inequality and the performance basis of pay. Nat. Hum. Behav. 6:646–55
     [Google Scholar]
  99. Perez-Truglia R. 2020. The effects of income transparency on well-being: evidence from a natural experiment. Am. Econ. Rev. 110:1019–54
     [Google Scholar]
  100. Pradel DW, Bowles HR, McGinn KL. 2005. When does gender matter in negotiation?. Negotiation 8:3–5
     [Google Scholar]
  101. Recalde MP, Vesterlund L. 2022. Gender differences in negotiation and policy for equalizing outcomes. Bargaining: Current Research and Future Directions E Karagözoğlu, KB Hyndman 455–75. New York: Springer
     [Google Scholar]
  102. Rigdon ML. 2012. An experimental investigation of gender differences in wage negotiations Work. Pap. Univ. Ariz. Tucson:
  103. Roussille N. 2022. The central role of the ask gap in gender pay inequality Work. Pap. Mass. Inst. Technol. Cambridge, MA:
  104. Sandberg S. 2013. Lean In: Women, Work, and the Will to Lead New York: Random House
  105. Säve-Söderbergh J. 2019. Gender gaps in salary negotiations: salary requests and starting salaries in the field. J. Econ. Behav. Organ. 161:35–51
     [Google Scholar]
  106. Seitz S, Sinha S. 2022. Pay transparency, workplace norms, and gender pay gap: early evidence from Germany Work. Pap. Univ. Manch. Manchester, UK:
  107. Sherman EL, Brands R, Ku G. 2023. Dropping anchor: a field experiment assessing a salary history ban with archival replication. Manag. Sci. 69:2919–32
     [Google Scholar]
  108. Sinha S. 2022. US salary history bans—strategic disclosure by job applicants and the gender pay gap. arXiv:2202.03602 [econ.GN]
  109. Skoda S. 2022. Directing job search in practice: mandating pay information in job ads Work. Pap. Univ. Zurich Zurich, Switz.:
  110. Small DA, Gelfand M, Babcock L, Gettman H. 2007. Who goes to the bargaining table? The influence of gender and framing on the initiation of negotiation. J. Pers. Soc. Psychol. 93:600–13
     [Google Scholar]
  111. Sockin J, Sockin M. 2023. A pay scale of their own: gender differences in variable pay Work. Pap. Univ. Pa. Philadelphia:
  112. Solnick SJ. 2001. Gender differences in the ultimatum game. Econ. Inq. 39:189–200
     [Google Scholar]
  113. Sran G, Vetter F, Walsh M. 2020. Employer responses to pay history inquiry bans Work. Pap. New York Univ. New York:
  114. Stevens CK, Bavetta AG, Gist ME. 1993. Gender differences in the acquisition of salary negotiation skills: the role of goals, self-efficacy, and perceived control. J. Appl. Psychol. 78:723–35
     [Google Scholar]
  115. Stuhlmacher AF, Walters AE. 1999. Gender differences in negotiation outcome: a meta-analysis. Pers. Psychol. 52:653–77
     [Google Scholar]
  116. Sutter M, Bosman R, Kocher MG, van Winden F. 2009. Gender pairing and bargaining—Beware the same sex!. Exp. Econ. 12:318–31
     [Google Scholar]
  117. Tinsley CH, Cheldelin SI, Schneider AK, Amanatullah ET. 2009. Women at the bargaining table: pitfalls and prospects. Negot. J. 25:233–48
     [Google Scholar]
  118. Zeltzer D. 2020. Gender homophily in referral networks: consequences for the Medicare physician earnings gap. Am. Econ. J. Appl. Econ. 12:169–97
     [Google Scholar]
/content/journals/10.1146/annurev-economics-092022-115353
Loading
  • Article Type: Review Article

Most Cited Most Cited RSS feed

This is a required field
Please enter a valid email address
Approval was a Success
Invalid data
An Error Occurred
Approval was partially successful, following selected items could not be processed due to error