Flexible Wages, Bargaining, and the Gender Gap

Barbara Biasi and Heather Sarsons

No 27894, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Does flexible pay increase the gender wage gap? To answer this question we analyze the wages of public-school teachers in Wisconsin, where a 2011 reform allowed school districts to set teachers' pay more flexibly and engage in individual negotiations. Using quasi-exogenous variation in the timing of the introduction of flexible pay driven by the expiration of pre-existing collective-bargaining agreements, we show that flexible pay increased the gender pay gap among teachers with the same credentials. This gap is larger for younger teachers and absent for teachers working under a female principal or superintendent. Survey evidence suggests that the gap is partly driven by women not engaging in negotiations over pay, especially when the counterpart is a man. This gap is not driven by gender differences in job mobility, ability, or a higher demand for male teachers. We conclude that environmental factors are an important determinant of the gender wage gap in contexts where workers are required to negotiate.

JEL-codes: J01 J08 J16 J5 (search for similar items in EconPapers)
Date: 2020-10
New Economics Papers: this item is included in nep-lab
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Citations: View citations in EconPapers (15)

Published as Barbara Biasi & Heather Sarsons, 2021. "Flexible Wages, Bargaining, and the Gender Gap," The Quarterly Journal of Economics, vol 137(1), pages 215-266.

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Working Paper: Flexible Wages, Bargaining, and the Gender Gap (2020)
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