And the wage gap can be significant. A decade after graduating, women who received a degree from Chicago Booth earned 50 percent less than the men in their class did, according to research by Bertrand and Harvard’s Claudia Goldin and Lawrence F. Katz. The women had worked shorter hours, accumulated fewer years of work experience, and were more likely to have taken time off from working. Additionally, Goldin finds, in a separate study, that in many high-paying occupations where there’s a link between hours worked and annual income, women have a particularly hard time matching men’s earnings.
Moreover, the women may have stifled their ambitions even while still in school. In an unidentified business school, single female students participated less in class than female students who were in relationships, which led University of Chicago’s Leonardo Bursztyn, Princeton’s Thomas Fujiwara, and Harvard’s Pallais to hypothesize that single women might try to not appear too smart or ambitious in front of people they might want to date or marry. The researchers then find that in a questionnaire about job preferences to be used for internship placement, what single women listed as career goals depended on whether their answers would be made public for class discussion. If the answers were up for discussion, the goals were less ambitious.
Women may be trying to avoid violating cultural norms, which have a man making money for a family and a woman caring for a household and children. Bertrand’s research with National University of Singapore’s Jessica Pan (a 2010 graduate of Chicago Booth’s PhD Program) and Booth’s Emir Kamenica suggests that when women outearned their husbands, couples were more likely to divorce, or women were more likely to do more housework and childcare, perhaps to compensate.
The ceiling is inefficient
Many groups consider advocating for women in the workplace to be a matter of fairness, but from a purely economic perspective, the current situation is simply inefficient. “All should agree that an economy that is tapping into a limited pool (men) to find its leaders must be operating inside the efficiency frontier,” Bertrand writes. “Starting from the position that innate talent is equally distributed between men and women, it must be the case that superior economic outcomes would be achieved if women had the same odds as men to make it to the top of the earnings distribution.”
Bertrand analyzed several measures that companies and organizations have introduced to make workplaces more equitable. Quotas and other affirmative-action policies miss the mark by failing to address the time demands of career and family, she writes, pointing to evidence suggesting that companies attempting to increase female representation on decision-making committees may wind up filling women’s schedules with work that won’t help them win promotions.
Policies such as longer parental leave, remote working options, and flexible hours are more promising, but only under certain conditions, she writes. As long as flexibility is financially penalized, and as long as structures are not in place to ensure that men choose flexible working arrangements as often as women do, these solutions could perpetuate the glass-ceiling problem. For example, Claremont McKenna’s Heather Antecol, University of California at Santa Barbara’s Kelly Bedard, and University of California at Davis’s Jenna Stearns looked at what happened to the tenure rate of assistant professors hired in the top 50 economics departments from 1980 to 2005 if their institution offered extra time on their tenure clocks, irrespective of their gender, when they became new parents. “We find that men are 17 percentage points more likely to get tenure in their first job once there is an established gender-neutral clock-stopping policy in place, while women are 19 percentage points less likely,” write Antecol, Bedard, and Stearns. “These policies substantially increase the gender gap in tenure rates. The primary mechanism driving these effects is an increase in the number of top-five journal publications by men with no such increase by women.”
Nonetheless, Bertrand suggests that designating a use-it-or-lose-it portion of parental leave for fathers, known as daddy quotas, may hold promise. “By nudging families toward more neutral childcare arrangements, [employers] aim to redress a key differential barrier women face in the workforce.”