Monday, July 30, 2007

Woman and Salary Negotiations: Damned If You Do, Damned If You Don’t

I can’t think of anything I’ve read that depressed me as much as this article in the Washington Post today about gender and salary negotiations.

Salary, Gender and the Social Cost of Haggling

The long and short of it is that women do not negotiate for salary (and other benefits) but that they might have good reason not to do so because there are social costs that say “be aggressive and we won’t like you.”

The traditional explanation for the gender differences that Babcock found is that men are simply more aggressive than women, perhaps because of a combination of genetics and upbringing. The solution to gender disparities, this school of thought suggests, is to train women to be more assertive and to ask for more. However, a new set of experiments by Babcock and Hannah Riley Bowles, who studies the psychology of organizations at Harvard's Kennedy School of Government, offers an entirely different explanation.

Their study, which was coauthored by Carnegie Mellon researcher Lei Lai, found that men and women get very different responses when they initiate negotiations. Although it may well be true that women often hurt themselves by not trying to negotiate, this study found that women's reluctance was based on an entirely reasonable and accurate view of how they were likely to be treated if they did. Both men and women were more likely to subtly penalize women who asked for more -- the perception was that women who asked for more were "less nice."

"What we found across all the studies is men were always less willing to work with a woman who had attempted to negotiate than with a woman who did not," Bowles said. "They always preferred to work with a woman who stayed mum. But it made no difference to the men whether a guy had chosen to negotiate or not."
The only thing that might give me pause about the study’s conclusion is that the social cost of being perceived negatively may be short-term. Because it was a lab experiment, it’s difficult to gauge whether after watching people negotiate is really going to have a lasting impression upon a coworker/boss. You only negotiate salary a few times, maybe once. And there will be far more interpersonal interaction between real employee/employers than what this study observed --which was basically asking strangers to evaluate strangers and then form opinions. It might be true that in the abstract we judge women more harshly for negotiating but in the individual cases other factors weigh in.

The other explanation however that I did appreciate is learning that this wage gap issue is not about the moral failings of women who simply aren’t assertive enough.
This isn't about fixing the women," Bowles said. "It isn't about telling women,'You need self-confidence or training.' They are responding to incentives within the social environment."

"It is not that women always act one way and men act another way; it tends to be moderated by situational factors," Bowles said. "The point of this paper is: Yes, there is an economic rationale to negotiate, but you have to weigh that against social risks of negotiating. What we show is those risks are higher for women than for men."

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