Risk Taking and Gender in Hierarchies

Suzanne Scotchmer

Department of Economics, Working Paper Series from Department of Economics, Institute for Business and Economic Research, UC Berkeley

Abstract: If promotion in a hierarchy is based on a random signal of ability, rates of promotion are affected by risk-taking. Further, the statistical properties of the surviving populations of risk-takers and non-risk-takers will be different, and will be changing throughout the hierarchy. I define promotion hierarchies with and without memory, where memory means that promotion depends on the entire history of success. In both types of hierarchies, surviving risk-takers have lower average ability than surviving non risk-takers at any stage where they have a higher probability of survival. However, that will not apply in the limit. With a common set of promotion standards, risk-takers will survive with lower probability than non risk-takers, and will have higher average ability. I give several interpretations for how these theorems relate to affirmative action, in light of considerable evidence that males are more risk-taking than females.

Keywords: labor markets; promotion; discrimination; affirmative action; hierarchy; risk taking; gender bias (search for similar items in EconPapers)
Date: 2006-07-30
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Related works:
Working Paper: Risk Taking and Gender in Hierarchies (2009)
Journal Article: Risk taking and gender in hierarchies (2008)
Working Paper: Risk-Taking and Gender in Hierarchies (2008)
Working Paper: Risk Taking and Gender in Hierarchies (2008)
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