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Gender premium and economic downswings

Author

Listed:
  • Shehu, Elona
  • Shahzad, Khurram
  • Rubbaniy, Ghulame
  • Perveen, Abida

Abstract

Using data of 2140 US firms over the period of 1998–2012, we investigate if gender–compensation relationship exists in executives’ compensation and bonus plans of the US firms; and whether this compensation difference is more visible during economic downswings. We find that not only the gender premium exists for male CEOs in executives’ compensation plans of the US companies but also the male executive bonuses are more sensitive to market downturns compared to their female counterparts. On average, female executives get a gender disadvantage in the form of lower total compensation and bonuses compared to their male counterparts, which persists even during adverse economic conditions. Finally, contrary to our initial expectations, we find male and female CEOs are equally likely to be laid-off, even during market recessions, despite female CEOs being claimed better manager by the mainstream literature.

Suggested Citation

  • Shehu, Elona & Shahzad, Khurram & Rubbaniy, Ghulame & Perveen, Abida, 2017. "Gender premium and economic downswings," Journal of Behavioral and Experimental Finance, Elsevier, vol. 14(C), pages 5-13.
    • Handle: RePEc:eee:beexfi:v:14:y:2017:i:c:p:5-13
    DOI: 10.1016/j.jbef.2017.03.001
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    Cited by:

    1. Agha, Mahmoud & Pramathevan, Shivani, 2023. "Executive gender, age, and corporate financial decisions and performance: The role of overconfidence," Journal of Behavioral and Experimental Finance, Elsevier, vol. 38(C).
    2. Rama K. Malladi & Joshua D. Mean, 2021. "Is it a gender representation issue or a gender pay gap issue? A study of the replaced executives in the USA," Business Economics, Palgrave Macmillan;National Association for Business Economics, vol. 56(2), pages 67-80, April.

    More about this item

    Keywords

    Corporate governance; CEO compensation; Firm performance; Global financial crisis; Gender; Gender premium;
    All these keywords.

    JEL classification:

    • F3 - International Economics - - International Finance
    • G12 - Financial Economics - - General Financial Markets - - - Asset Pricing; Trading Volume; Bond Interest Rates

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