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Mentoring can reduce gender gap in competitiveness and earnings expectations

Competitiveness is an individual trait that has been shown to be highly predictive of career choices and labor market outcomes and for which a strong gender gap is often found. Gender differences in preferences for competition might therefore provide a partial explanation for gender disparities in career choices, such as differential selection into STEM fields or finance.

A new study by Teodora Boneva, Thomas Buser, Armin Falk and Fabian Kosse provides causal evidence on the impact of socioeconomic background at a young age on preferences for competition and gender differences in these preferences. The analysis is based on the briq family panel, consisting of families living in the German cities of Bonn and Cologne with children born between 2002 and 2004.

To isolate results on the effects of a change to the social environment, around 30 percent of the children in the sample were randomly assigned to a well-established and intensive mentoring program called “Baloo and You”. For a period of about one year, children are provided with a mentor whose brief it is to act as a role model and to enrich the social environment. Volunteer mentors are predominantly university students, and all girls are assigned to a female mentor, thereby exposing girls of low socioeconomic status (SES) to a successful female role model.

Mother’s competitiveness matters for girls

A first finding indicating a potential positive effect of the mentoring program is that the mother’s competitiveness has a positive effect on girls but not on boys. Thus, female role models might be particularly important for shaping girl’s competitiveness.

The broader results confirm earlier findings of significant differences in competitiveness between girls and boys, however the gender gap registered for adolescents with low socioeconomic background stands out. Socioeconomically disadvantaged girls are 4.5 times more likely to be found at the bottom of the competitiveness distribution than boys with comparable SES. On the other hand, girls profiting from a more favorable background (high SES) are “only” twice as likely to show very low competitiveness in comparison to boys with high SES.

The mentoring intervention significantly narrows the gender difference in competitiveness by increasing girls’ willingness to compete especially among those most averse to competition. The gap between the gender differences in competitiveness of the disadvantaged and the advantaged group is closed entirely.

Mentees raise their earnings expectations

A similar pattern emerges for earnings expectations. About six years after the intervention the authors administered a questionnaire in which they elicit the adolescents believe about their earnings at age 30. While the teenagers in this sample have not entered the labor market yet, data shows that there are already large gender gaps regarding expected earnings at this age, especially among the group of low SES adolescents.

Girls with poor socioeconomic background expect 36.7% lower earnings than boys exposed to a similar social environment. The gender gap in the group with high SES is only 8.8%. The intervention reduced the gender gap in the low SES group by 23.3 percentage points to 13.4%, which is statistically indistinguishable from the gender gap in the high SES group.

Taken together, the results suggest that girls with low socioeconomic status are doubly disadvantaged, by both their socioeconomic background and their gender, but that interventions can partially mitigate this disadvantage. The results have important policy implications: Providing adolescents with an enriched social environment may not only result in better outcomes for disadvantaged children but may also lead to a significant reduction in gender inequality.

Suanna Oh receives Distinguished CESifo Affiliate Award

Suanna Oh, briq postdoctoral fellow since September 2021, has been selected as the winner of this year’s Distinguished CESifo Affiliate Award in the area of behavioral economics. The prize is funded by the international CESifo research network based in Munich and aims at identifying promising young researchers. Previous winners include briq research director Florian Zimmermann and briq research affiliate Matt Lowe.

Oh’s paper “Does Identity Affect Labor Supply?” investigates this question in rural India, focusing on the effect of caste identity on job-specific labor supply. In a field experiment, laborers chose whether to take up various one-day job offers, which differed in associations with specific castes. Workers were less willing to accept offers that were linked to castes other than their own, especially when those castes ranked lower in the social hierarchy. Workers forewent large payments – ten times their daily wage for half of the sample – to avoid job offers that conflicted with their caste identity, regardless of whether these decisions were made in private.

Read more about the paper in a VoxDev column.

What’s worth knowing in economics?

Global survey of almost 10,000 academic economists shows: Many economists think that economic research should become more policy relevant, multidisciplinary, and disruptive, and pursue more diverse research topics.

Peter Andre

Science and research matter. They shape how we think about ourselves, how we live together, and how we design policies. What researchers work on, which topics they choose, and how they resolve trade-offs between different research objectives is therefore of central societal importance. However, the question about what is “interesting” and “worth knowing” cannot be answered scientifically. Instead, researchers must retreat to their intuition and personal value judgments.

Armin Falk

How do economists think about this “problem of problem choice”? Which fundamental research objectives do they think economists should pursue? Which research topics should they explore? In search for answers, briq researchers Peter Andre and Armin Falk conducted a global survey of almost 10,000 academic economists about their views on what is worth knowing in economics.

For details, download the full study or read the authors’ VoxEU column.

Why do some children lie and others don’t?

Reporting private information is a key part of economic decision making. A recent literature has found that many people have a preference for honest reporting, contrary to usual economic assumptions.

In a new working paper, Johannes Abeler, Armin Falk and Fabian Kosse investigate whether preferences for honesty are malleable and what determines them. Experimentally measuring preferences for honesty in a sample of children, the authors find that children from families with higher socio-economic status (SES) are more honest.

Causal effect of the social environment

The study uses data from the briq family panel, an annual survey of 700 families in the Cologne-Bonn region. To assess the causal effect of the social environment, children from low-SES households were randomly enrolled in a year-long mentoring program. The volunteer mentors spend an afternoon per week with the children and engage in interactive social activities such as cooking, playing football, or doing handicraft activities.

The mentoring program thus enriches the social environment of the children and widens their horizon by providing inputs and experiences that are potentially scarce in low-SES families and, at the same time, essential for the development of honesty preferences.

The researchers find that preferences for honesty are indeed malleable and that they can be changed by such an intervention: About four years after the end of the program, mentored children are significantly more honest. The results thus suggest that early-childhood interventions cannot just improve a child’s achievements but also affect their social and moral behavior.

Self-image plays an important role for moral behavior

Several experimental studies have shown that social image concerns play an important role when people make decisions that may be perceived by others as immoral. A new study by Armin Falk, now published in the Journal of Economic Behavior & Organization, shows that individuals not only care about social image, but also about a positive image vis-à-vis themselves.

To study the causal impact of self-image concerns on moral behavior, Falk exposed subjects to a morally-relevant decision context while randomly varying self-image concerns. Participants in the experiment had the option to earn money by inflicting a painful, yet harmless, electric shock on another participant. A randomly selected group of participants saw their own face on the decision screen in a real-time video feed. To ensure that the behavioral effect can be attributed to self-image rather than the video as such, another group saw themselves in a mirror. Two control groups saw either no video at all or a neutral video.

As the figure shows, those who were confronted with their own image on the screen or in the mirror were significantly less likely to inflict pain on others in return for money. In other words, an exogenous increase in the salience of self-image reduces immoral behavior.

In terms of practical implications, Falk suggests that firms, organizations or tax authorities seeking to promote socially responsible behaviors may want to create environments that draw individuals’ attention to themselves when taking decisions.

briq now certified as a carbon-neutral institute

Behavioral aspects and inequality consequences of climate change are an important part of the briq research agenda. In order to also make our own contribution to limiting global warming, we have reduced our carbon footprint and acquired climate certificates to offset our remaining greenhouse gas emissions from buildings, events, and business travel.

Academic research at an internationally oriented institute like briq strongly relies on the scholarly exchange of thoughts and ideas. Current COVID-19 restrictions aside, regular visits by guest researchers and conference participants from all over the world cause CO2 emissions that cannot be fully avoided.

By implementing a number of targeted measures, including the modernization of our heating and lighting, we have been able to substantially reduce briq’s carbon footprint over the past years. For domestic business trips that cannot be substituted by videoconferencing, the preferred mode of transport is the German railway, whose long-distance trains run on green energy. Employees at briq are incentivized to use public transport for the commute to work and will soon have the option to use job bikes as well. Catering for seminars, workshops, and conferences has been switched to vegetarian meals that can be produced with significantly fewer greenhouse gas emissions than meats.

The remaining CO2 emissions stemming from briq’s business activities, as calculated for the year 2019 and certified by TÜV Rheinland, have been offset through investments in climate protection projects supported by the myclimate foundation. In line with our research focus, we have chosen to invest in projects that also contribute to a reduction of economic and social inequality. These include a project in Kenya enabling women through savings groups to afford an efficient cook stove which reduces the demand for firewood, as well as a project in Myanmar that combines mangrove restoration and women empowerment.

“The COVID-19 pandemic has drawn global attention away from the climate crisis even though climate change will likely pose a far greater threat to humankind. Tackling this huge challenge requires a contribution by everyone, no matter how big or small. By achieving carbon neutrality at briq, we hope to set an example for others to follow suit,” says briq Director Armin Falk.