Taste for Competition and the Gender Gap Among Young Business Professionals
Using an incentivized measure of test for competition, this paper investigates whether this taste explains subsequent gender differences in earnings and industry choice in a sample of high-ability MBA graduates. We find that “competitive” individuals earn 9% more than their less competitive counterparts do. Moreover, gender differences in taste for competition explain around 10% of the overall gender gap. We also find that competitive individuals are more likely to work in high-paying industries nine years later, which suggests that the relation between taste for competition and earnings persists in the long run. Lastly, we find that the effect of taste for competition emerges over time when MBAs and firms interact with each other.
We thank the Templeton Foundation for financial support. We are also thankful for the comments we received from Muriel Niederle, Anne Preston, Christian Traxler, and Roel van Veldhuizen. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.