The old boy network: are the professional networks of female executives less effective than men's for advancing their careers?

Abstract

We investigate the impact of professional networks on men's and women's earnings, using a dataset of European and North American executives. The size of an individual's network of influential former colleagues has a large positive association with remuneration, with an elasticity of around 21%. However, controlling for unobserved heterogeneity using various fixed effects as well as a placebo technique, we find that the real causal impact of networks is barely positive for men and significantly lower for women. We provide suggestive evidence indicating that the apparent discrimination against women is due to two factors: first, both men and women are helped more by own-gender than other-gender connections, and men have more of these than women do. Second, a subset of employers we identify as ‘female friendly firms’ recruit more women but reward networks less than other firms.

Keywords

JEL codes

Reference

Marie Lalanne, and Paul Seabright, “The old boy network: are the professional networks of female executives less effective than men's for advancing their careers?”, Journal of Institutional Economics, February 2022, pp. 1–20.