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The Distribution of Nonwage Benefits: Maternity Benefits and Gender Diversity

Author

Listed:
  • Tim Liu
  • Christos A
  • Paige Ouimet
  • Elena Simintzi

Abstract

Why do firms offer nonwage compensation instead of the equivalent amount in financial compensation? We argue that firms use nonwage benefits, specifically female-friendly benefits, such as maternity leave, to increase gender diversity by efficiently attracting women. Using Glassdoor data, we show that firms offer higher-quality maternity leave benefits in labor markets in which female talent is relatively scarce. This result also holds more generally when examining all female-friendly nonwage benefits and is not present when looking at gender-neutral benefits. Moreover, using staggered adoption of state laws, we show that voluntary provision of these benefits can increase firm value.Wei Jiang. Authors have furnished an Internet Appendix, which is available on the Oxford University Press Web site next to the link to the final published paper online

Suggested Citation

  • Tim Liu & Christos A & Paige Ouimet & Elena Simintzi, 2023. "The Distribution of Nonwage Benefits: Maternity Benefits and Gender Diversity," The Review of Financial Studies, Society for Financial Studies, vol. 36(1), pages 194-234.
    • Handle: RePEc:oup:rfinst:v:36:y:2023:i:1:p:194-234.
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    File URL: http://hdl.handle.net/10.1093/rfs/hhac039
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    More about this item

    JEL classification:

    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • J32 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Nonwage Labor Costs and Benefits; Retirement Plans; Private Pensions
    • J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General

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