Keywords

The gender pay gap, like other pay inequalities, is a major issue in the equal opportunity discourse, legislation, and the media. Every year, on International Women’s Rights Day, worldwide statistics about pay disparities are presented as one of the main illustrations of discrimination against women. However, economic gender inequalities go beyond the pay gap. The World Economic Forum (2017) publishes four gender gap indicators, including the economic participation and opportunities index. It shows that women have lower labor force participation, remuneration, and advancement opportunities. All three of these contribute to women having only reached 58% of men’s economic power worldwide. At current rates of change, it is estimated that it would take 217 years to achieve economic gender parity if no further measures are taken.

Why should women’s disadvantage be of particular concern? Women are more likely to live in poverty for at least two reasons. First, the intersection of female gender and other social markers tends to intensify the negative effects of inequality for women. Their disadvantage increases further when they belong to an ethnic minority, are elderly, divorced, widowed, or a single parent (European Commission, 2018; Fontenot, Semega, & Kollar, 2018; Munoz Boudet et al., 2018). Second, dealing with women’s disadvantage goes far beyond the social objective of treating women and men equally. Gender equality in economic resources is linked to multiple positive outcomes affecting society at large, such as poverty reduction and the welfare of children (United Nations, 2009). Furthermore, it is positively related to equitable and sustainable economic growth (Kennedy, Rae, Sheridan, & Valadkhani, 2017; Seguino, 2000).

In this chapter, we will first outline the nature of, and current trends in explaining, economic gender inequality and then provide an analysis of social psychological mechanisms that have enshrined this female disadvantage, defying policies that aim to close the gap. We propose that the primary explanatory social psychological mechanisms responsible for the gap are gender stereotypes that view men as powerful actors and primary income earners, and women as secondary earners. We will show that stereotypes affect the people allocating resources to women and evaluating the value of stereotypical feminine or masculine work as well as women themselves (and thus their preferences and behaviors).

The Nature and Current Explanations of Economic Gender Inequalities

A study covering 144 countries revealed that the average annual pay for men ($21,000) is almost double that of women ($12,000) (World Economic Forum, 2017). Of course, this ratio varies from country to country, and in Europe, women earn 16.2% less than men (European Commission, 2018). Overall, women are paid less than men in most work domains and at all hierarchical levels, with a widening gap in leadership positions and an increase over lifetime (Kulich, Anisman-Razin, & Saguy, 2015; Manning & Swaffield, 2008). These disparities culminate into a significant gap in pensions at retirement and a lifetime pay penalty. For instance, in Europe, women’s pensions are on average 37.2% lower than men’s (European Commission, 2018). In Australia, over the course of her lifetime, the average woman earns one million Australian dollars less than the average man (Australian Council of Trade Unions, 2016).

Women’s economic disadvantage also has more indirect causes, such as disparities in the budget and funding invested in women’s professional activities and careers. For example, female researchers are less likely to secure funding for academic research than men (European Research Council, 2016; Larivière, Vignola-Gagné, Villeneuve, Gélinas, & Gingras, 2011; Ley & Hamilton, 2008). Moreover, women’s lower representation in decision-making positions, particularly in politics, contributes to economic disparities. Female politicians and managers have been shown to be more likely than men to enact policies and budget spending that is beneficial to women, children, and the poor, for instance in the domains of education and health care (e.g., Adams & Funk, 2012; Anzia & Berry, 2011; Reingold & Smith, 2012).

Most research seeking to explain gender economic inequalities concentrates on the pay gap. In meritocratic organizations, the basic principle to determine “fair” pay is that comparable work and performances should be remunerated equally (England, 2017). From an economic point of view, human capital factors (i.e., education and job experience) and job characteristics (i.e., task difficulty and level of competence required) should thus determine the level of pay (Scully, 1992). The earliest investigations into the pay gap primarily focused on human capital differences, arguing that women earn less due to their lower productivity, which was attributed to a lack of competence and fewer work experiences. In 1980, these human capital differences explained 27% of the pay gap in the United States. However, recent analyses suggest that women today are better educated than men and have similar job experiences. In 2010, only 8% of the pay gap could be explained by these human capital factors (Blau & Kahn, 2017).

To understand the whole picture of financial inequalities, we therefore need to look beyond these human capital differences. One must also take into account structural inequalities in society at large. To begin with, women’s labor force participation is lower than men’s (66.6 % vs. 78.1% respectively). Moreover, women are more likely to occupy non-standard forms of employment such as part-time and temporary positions (30% for women vs. 8% for men), which typically pay lower hourly wages and are associated with fewer career opportunities (European Commission, 2018). The overrepresentation of women in such forms of employment tends to be due to women’s higher participation in household chores and childcare (European Commission, 2018). Finally, women are overrepresented in traditionally female professions (e.g., the services sector, including the care of elderly people, teaching) which are typically paid less than traditionally male professions (e.g., the industrial sector, Blau & Kahn, 2017; Levanon, England, & Allison, 2009). Indeed, this gender segregation into different job types accounts for the largest portion of the pay gap today (51% in 2010 vs. 20% in 1980, Blau & Kahn, 2017). It is also the case that male employees in female professions tend to be better paid than their female peers, thereby multiplying women’s disadvantage (e.g., nursing, Wilson, Butler, Butler, & Johnson, 2018).

In order to shed light on the factors accounting for the remaining variance of the gender gap (i.e., beyond the impact of human resources and structural factors), scholars have turned their attention toward more psychological variables: gender discrimination in hiring (Altonji & Blank, 1999) and psychological gender differences such as women’s lower pay expectations or risk-taking and competitive behaviors (see for an overview Bertrand, 2011). Quantifying the latter individual-based explanation is difficult, but analysis on UK data suggests that these psychological gender differences may account for about 20% of the pay gap (Manning & Swaffield, 2008).

In sum, existing work suggests that the gender pay gap can, to a large extent, be accounted for by differences in women’s human capital, their tendency to cluster in female-dominated occupations and psychological factors that impact how women job applicants are perceived and how women behave. At the same time, however, it is clear that these do not provide the ultimate explanation. To understand why gender discrimination and gender differences in attitudes and behavior occur (as well as human capital and occupational segregation), we need to understand the social norms and stereotypes that ascribe what genders are like or ought to be like (Arkerlof & Kranton, 2000; Bertrand, 2011; Blau & Kahn, 2017; England, 2017). These underlying social mechanisms are not only relevant to the gender pay gap. They also have the potential to contribute to the understanding of economic inequalities more generally (see also Batruch & Butera, chapter “The Paradoxical Role of Meritocratic Selection in the Perpetuation of Social Inequalities at School”). Indicators of economic gender inequality are only one of the symptoms of a society characterized by social inequalities more generally. Thus, it is not the quality of the female gender that makes women a disadvantaged group; rather it is the lower status accorded to women. Women, as well as other low status groups, face the consequences of a general tendency toward a hierarchization of society.

Explaining Economic Gender Inequalities: The Social Factors

Why is gender a predominant factor predicting economic and social inequalities? Gender is a highly visible but also socially relevant characteristic which individuals tend to focus on more easily than other categories such as age, ethnicity, or social class (e.g., Fiske, Haslam, & Fiske, 1991; Haslam, Rothschild, & Ernst, 2000). Thus, when encountering a person for the first time, gender is one of the primary features that will be noticed. Compared to other social groups (e.g., men and ethnic groups), women are the most strongly essentialized category, leading to assumptions that women have “an underlying reality, an essence that makes women what they are” (p. 202, Prentice & Miller, 2007). Women are typically perceived as having positive warmth-related qualities, describing them as tolerant and sincere. They are also perceived to have few qualities related to competence such as being competitive and independent. The reverse is the case for men, who are associated with lower warmth but higher competence (Fiske, Cuddy, Glick, & Xu, 2002; Fiske & Durante, chapter “Mutual Status Stereotypes Maintain Inequality”). Men may thus be believed and expected to be high performers, good negotiators, and interested in financial rewards, whereas women are believed and expected to be more concerned with interpersonal relationships and family than with career or monetary rewards.

On the basis of these findings, we will demonstrate that (1) the allocation of economic resources to individual women (discrimination), (2) the value allocated to work performed by female workers (occupational gender segregation), and (3) women’s own preferences and behaviors (psychological gender differences) are socially constructed.

Stereotypes and the Allocation of Resources

When assessing an employee for promotions or pay rises, there is evidence that people evaluate the employee’s behaviors and traits differently depending on whether they are a man or a woman (Taylor, Fiske, Etcoff, & Ruderman, 1978). Experimental studies have demonstrated that men receive more positive evaluations and better ratings than women for objectively identical outcomes, or behaviors. This is particularly true in typically masculine domains, such as writing an article in a masculine field (Paludi & Bauer, 1983), teaching a physics class (Graves, Hoshino-Browne, & Lui, 2017), designing a house (Proudfoot, Kay, & Koval, 2015), or being a leader (see for a meta-analysis Eagly, Makhijani, & Klonsky, 1992). In addition, job applicants tend to be rated more highly when they are applying to jobs that are prototypical for their own gender (see meta-analysis by Davison & Burke, 2000).

Following these biased evaluations, one may expect that pay inequalities derive from lower ratings of women’s performance in particular in masculine domains. However, whether a good evaluation translates into higher promotional outcomes, or bad evaluations in lower outcomes, depends also on the gender of the evaluated person. Indeed, in a meta-analysis of field studies, it was shown that gender differences in performance ratings do not predict gender differences in economic and promotional outcomes (Joshi, Son, & Roh, 2015). In a similar vein, archival studies on medical doctors (Evers & Sieverding, 2014) and company directors (Albanesi, Olivetti, & Prados, 2015; Kulich, Trojanowski, Ryan, Haslam, & Renneboog, 2011) have shown that individual or company performance was positively related to pay for men, but not for women. These results suggest that economic inequalities are not only a matter of lower income for women regardless of their performance, but that they also exist because women’s performance ratings do not translate into financial and promotional outcomes in the same ways as they do for men. Furthermore, when parental status (another gender related social category) is added to the mix, women are at an even greater disadvantage. For example, research has shown that parental status can increase gender financial inequalities, through a higher valorization of parenthood for men than women (Correll, Benard, & Paik, 2007; Fuegen, Biernat, Haines, & Deaux, 2004).

But why do these gender differences occur? Two mechanisms may help explain them: gendered attributional biases and performance standards. Research on performance attributions showed that when women performed well in a masculine domain, their success was attributed to external sources such as luck and effort rather than their ability (Deaux & Emswiller, 1974). Of importance, such external performance attributions were shown to elicit lower promotions and reward allocations than attributions to ability (Heilman & Guzzo, 1978). Thus, the fact that women are not remunerated in relation to their successes or failures may be explained by these biased attributions. Moreover, higher and stricter performance standards, or double standards, are applied to female performers. To be considered competent in a male domain, a woman has to perform well on several occasions, whereas a single good performance is sufficient for a man (Foschi, 2000). Thus, women potentially need to show higher performance in order to satisfy the double standard applied to them and to be allocated equal pay. Complementing this, beneficial internal ability-based attributions of performance may be made more readily for men because a stereotypical male-manager, male-doctor, or male-negotiator association exists (Schein, 2001).

Another phenomenon, the backlash effect (Rudman & Fairchild, 2004), demonstrates that even if women’s competences are acknowledged this is not a guarantee for pay equality because competence-evaluations do not translate straightforwardly into remuneration for women. Women displaying agentic competences, such as self-promotion and negotiating behavior, are less likely to be allocated promotions and additional pay than men because they are perceived to violate social norms of femininity. Indeed, stereotypes not only provide the content of beliefs by describing group features, they also shape behavioral expectations (Cialdini & Trost, 1998), prescribing certain behaviors and proscribing others (Prentice & Carranza, 2002). Thus, agentic women are perceived as lacking relational traits, being pushy, “unwomanly” and unsympathetic (Kray & Thompson, 2005). As a consequence, women face a dilemma: showing agentic traits and behaviors leads to high competence ratings but low warmth ratings, whereas showing communal traits and behaviors leads to high warmth but low competence ratings (Rudman, Moss-Racusin, Glick, & Phelan, 2012). Both of these profiles impede equal pay.

Economists claim that human capital should determine pay but we have outlined that the evaluation of performance and competences is likely to be biased by stereotypes. Thus, discrimination against women is not an easily visible and conscious violation of meritocratic principles. Evaluators might not be aware that their “objective” assessments of performances are in fact influenced by gender stereotypes. Moreover, even if competence is acknowledged, agentic women are likely to face backlash.

Stereotypes and Job Value

According to meritocratic principles, job characteristics that impose higher difficulty and higher demands on the worker should be related to higher pay. However, as indicated in the previous section, job content is also gendered and likely influences evaluations of women’s and men’s performances. So, why are some domains considered as typically masculine and others as typically feminine? And why are these domains differentially valued?

Sociological theories argue that people’s beliefs about women and men are shaped by the observations they make of the social roles that women and men typically occupy in society (see social role theory, Eagly, 1987; Eagly, Wood, & Diekman, 2000). Thus, seeing women in communal caregiving and inter-relational roles makes the observer assume that women have the corresponding competences which are viewed as typically feminine. In contrast, financial or competition-related contexts, as well as higher power roles are typically enacted by men and thus are seen as demanding masculine competences (Heilman, 2001; Schein, 2001). The two dimensions of stereotypes (warmth and competence) have sociological origins but also reflect more general cognitive representations of social groups: Low status groups tend to be associated with high warmth and low competence, while high status groups are associated with low warmth and high competence (Fiske et al., 2002). As a consequence, activities typically performed by women are generally associated with lower status and value than activities typically performed by men. For instance, cross-sectional and longitudinal studies have shown that average pay in professions decreases when the share of women entering an occupation increases (US and Western-European countries, Baron & Newman, 1990; Levanon et al., 2009; Murphy & Oesch, 2016). Further, pay is lower the higher the proportion of working women in a society (panel study across 59 countries Van de Vliert & Van der Vegt, 2004). Together with other work, this suggests that it is not the specific content of an activity which determines its value, but rather the status of the people performing it. Indeed, research has shown that stereotypical feminine job content is associated with lower evaluations, remuneration, and funding compared to stereotypical masculine job content. For example, Vancouver and Ilgen (1989) found that participants expected to perform better on a typically feminine task than a typically masculine one, suggesting that feminine tasks were considered easier. Moreover, in the academic world, research on gender bias was less likely to be funded and to be published in high impact journals compared to research on other types of social discrimination (Cislak, Formanowicz, & Saguy, 2018). This suggests that bias against women was considered less important and research on it was less valued by evaluators.

The lower valuation of women’s contributions, typically feminine professions and activities, helps us to understand why feminine professions generally pay less. But why are men paid more and are more likely to be promoted than women even in typically feminine domains, like nursing? Are men evaluated more positively than women even in these domains? Research has shown that in typically feminine domains, men may be rated more favorably than women (MacNell, Driscoll, & Hunt, 2015), but they may also be rated equally (Deaux & Emswiller, 1974), or even less favorably (Davison & Burke, 2000; Vancouver & Ilgen, 1989). This suggests that evaluations are not the only reason for the overpayment of men.

One potential other explanation is that feminine tasks tend to be considered easier and as demanding a lower level of competence (e.g., creativity, Proudfoot et al., 2015). Accordingly, men may be perceived as more likely to succeed. Another related explanation is that lower status individuals (e.g., women) tend to be viewed as sharing a lot of commonalities and thus are generally viewed in more stereotypical ways. In the process, people tend to expect women to conform to group norms more strongly than men (Lorenzi-Cioldi, Eagly, & Stewart, 1995; Stewart, Vassar, Sanchez, & David, 2000). In contrast, higher status individuals are more likely to be perceived as individuals with distinct characteristics and abilities, which gives them higher liberty in the traits and behaviors they can express (Lorenzi-Cioldi, 2006). Consequently, biased processing generally happens more in the evaluation of low than high status individuals (Sekaquaptewa & Espinoza, 2004). Thus, because men are considered as having the possibility to do a greater variety of things, it is easier to accept the idea that they are also good at feminine tasks. Men’s performance can therefore be more valued and better paid than women’s, as long as men do not engage in activities that violate the masculinity norm of high status (Bosak, Kulich, Rudman, & Kinahan, 2018).

Overall, human capital factors and job content tend to reflect the value associated to the gender group typically performing this work. Encouraging men to perform communal activities and women agentic ones may help to overcome some of the gap. However, gender hierarchization likely remains when men occupy higher status positions than women within a domain.

Stereotypes Affect Women’s Pay Attitudes, Preferences, and Performances

The third factor impeding equal pay relates to gender differences in attitudes, preferences, and behavior in the domain of finance. A collection of studies has illustrated that women significantly differ from men in several attitudes such as having lower pay expectations and deservingness perceptions (meta-analysis by Williams, McDaniel, & Nguyen, 2006). Women also differ from men on various psychological attributes such that women display higher risk-aversion, and lower self-confidence, competitiveness, or willingness to negotiate (see for overview Bertrand, 2011; Babcock & Laschever, 2003; Barber & Odean, 2001; Byrnes, Miller, & Schafer, 1999; Croson & Gneezy, 2009; Kray & Thompson, 2005; Prince, 1993). Moreover, women tend to choose feminine educational paths and careers which pay less and are less valued (Chen & Moons, 2015; European Commission, 2018). Finally, they may underperform in negotiations or other masculine performance tasks (Babcock & Laschever, 2003; Mazei et al., 2015). All together, these gender differences contribute to lowering not only women’s desire for higher pay, but also their productivity, and may thus have a similar influence on pay as human-capital variables (Le, Miller, Slutske, & Martin, 2011; Mueller & Plug, 2006). Of importance, various social psychological findings show that these individual differences between women and men are highly context-dependent. In particular, certain situations may facilitate self-stereotyping which are particularly likely to prevent women from acting freely.

The main point we will make is that gender stereotypes are not limited to biased evaluations of others, they can also impact self-evaluations (e.g., Beyer & Bowden, 1997; Sinclair, Huntsinger, Skorinko, & Hardin, 2005). Although stereotypical qualities shape both women’s and men’s self-concepts, thus impacting their cognitions, emotions, and behaviors (Wood & Eagly, 2015), women tend to self-stereotype more than men (Lorenzi-Cioldi, 1991). Social norms and self-stereotyping can make these gender differences disappear or even reverse them, depending on situational factors. We will now review three social mechanisms which can attenuate gender differences: (1) salience of the gender category, (2) social status, and (3) fear of social punishments.

The Salience of the Gender Category

The salience of the gender category in a situation will impact on individuals’ tendencies to act in stereotypical ways or not (e.g., Tajfel & Turner, 1986). For example, stereotype threat research shows that the salience of female gender group membership can make negative stereotypes implicitly accessible to women (e.g., in a negotiation situation one may automatically think of the stereotype that women lack negotiation competences). The resulting threat perceptions associated with the possibility of being unfavorably judged due to women’s gender group membership, subsequently leads to impaired performance—perhaps through stress responses which decrease cognitive resources allocated to the task (Kray, Thompson, & Galinsky, 2001; Hoyt & Murphy, 2016; Rubin, Evans & McGuffog, chapter “Social Class Differences in Social Integration at University: Implications for Academic Outcomes and Mental Health”). However, making stereotypes about women’s negotiation incompetence more explicit has been shown to reverse the effect. In this situation, women show reactance, which improves their performance (Kray et al., 2001).

Female gender tends to be particularly salient in masculine contexts, that is counter-stereotypical contexts, which demands competences and behaviors that are perceived as typically masculine (Ridgeway, 2001). Thus, masculine domains such as finance, negotiations, or professional advancement, make gender chronically salient to women, thereby encouraging gender congruent attitudes. Indeed, it has been shown that gender differences in risk aversion, self-confidence, and other attitudes were particularly pronounced in financial matters (for reviews see Kray & Thompson, 2005; Bertrand, 2011). Of importance, such differences disappear—or reverse—in neutral or more feminine contexts such as social decisions (Weber, Blais, & Betz, 2002). Overall, when gender is implicitly salient, through directing women’s attention to their gender category or the diagnostic force of a test, women’s attitudes and behavior likely are contingent to gender stereotypes. However, explicit expression of negative stereotypes such as hostile sexism likely produces resistance in women leading to gender incongruent demonstrations of competence.

Social Status

Research showed that people in lower paying jobs tend to show depressed entitlement: that is, to perceive themselves as deserving less pay than high status people perceive they deserved (Pelham & Hetts, 2001). Women are typically found in lower status positions than men. For this reason, it is not surprising that women tend to indicate lower deservingness than men (e.g., Bylsma, Major, & Cozzarelli, 1995; Jost, 1997; Pelham & Hetts, 2001). On this basis, we would expect that psychological gender differences should be attenuated among women occupying high status positions. Indeed, there is work showing that when women are allocated higher status, the difference in depressed entitlement is reduced (Haynes & Heilman, 2013). Similarly, gender differences in risk aversion have been found to be absent in professional populations or even reversed in managerial samples (Adams & Funk, 2012; Croson & Gneezy, 2009). As for pay satisfaction, women tend to be as “contented” as men, despite the pay gap. However, when looking at employees in higher status roles (e.g., managers) women indicate pay dissatisfaction and perceptions of unfairness (Keaveny & Inderrieden, 2000; Kulich, 2008). Finally, women have been shown to choose low paying feminine professions because they think it is unlikely that they will reach high status positions in masculine jobs (Chen & Moons, 2015). To the extent that women stay in low status positions for these reasons, this is likely to reinforce the gender gap in depressed entitlement beliefs.

Social Norm Pressures

Negotiating is an agentic behavior violating feminine norms which can elicit negative reactions and consequently lead to lower promotional outcomes (otherwise known as backlash). Women anticipate these social costs and tend to downplay or hide good performance and competence (Rudman et al., 2012). They will also refrain from pay negotiations in order to escape social disapproval (Kray & Thompson, 2005). Indeed, women achieve lower negotiation outcomes than men and are less likely to initiate negotiations (see meta-analysis by Mazei et al., 2015) due to uneasiness and nervousness (Bowles, Babcock, & Lai, 2007; Babcock & Laschever, 2003). However, when negotiating is framed in a way that is more compatible with female gender stereotypes, such as negotiating on behalf of others, women show more assertive competing behavior, leading to better outcomes even than those achieved by men and by women bargaining for themselves (Amanatullah & Morris, 2010; see also Mazei et al., 2015).

Although economic inequalities can be reinforced by women’s self-limiting behaviors, these three social dynamics illustrate that these behaviors are not rigid and enshrined in women’s personalities. Rather, they are produced or inhibited by contextual circumstances. Thus, reduction of chronical salience of gender in society and organizations, attributions of higher status to women, and contexts embracing counter-stereotypical behavior can contribute to decrease the financial gender gap.

Implications and Interventions

Economic inequalities go beyond social class or socioeconomic status. Memberships in other social groups such as female gender are important correlates. In this chapter we illustrated that economic gender inequalities arise from a complex interplay of hiring bias, devaluation of women’s work, and gender differences in how men and women react to work and financial contexts. Gender stereotypes create the social reality in which performance ratings become biased and pay-performance relations deviate from meritocratic principles. The value of job content is affected by the value associated with the social groups typically enacting it, and women’s self-limiting behaviors arise from the constraints imposed by gender norms.

What are the implications of the pay gap for women and for income inequality more generally? And how should these inequalities be tackled? Gender inequality is part of society due to several derivates of women’s lower economic status. Lowly (compared to highly) paid individuals are perceived as less competent and more warm (Johannesen-Schmidt & Eagly, 2002), which reinforces stereotypical perceptions of women who are chronically paid less. In addition, women’s lower political and managerial empowerment in a world largely dominated by male decision-makers puts women in a disadvantaged position as concerns promotional outcomes. Indeed, people tend to take ingroup favoring evaluative and allocation decisions and show less support to outgroups (Bodenhausen, Kang, & Peery, 2012), with individuals in powerful positions being particularly prone to express such bias (Goodwin, Operario, & Fiske, 1998).

Thus, as long as men largely determine the distribution of economic resources and advancement opportunities, it will be difficult for women to progress. For women, gaining higher status, for example, through occupational mobility, may attenuate some gender differences in self-advocacy, confidence, or entitlement beliefs. However, if this advancement is not accompanied by higher pay (cf. widening pay gap in managerial positions), their work likely will be less valued. In the same vein, performance expectations and willingness to accept their influence will be lower (Ridgeway, 2001). Thus, even if women gain positions of higher power due to their economic disadvantage, they are put into more difficult positions compared to men, and likely refrain from engagement in, potentially higher paying, masculine domains due to anticipating disadvantaged treatment (Chen & Moons, 2015).

We suggest three keys to economic gender equality. First, providing equal promotional and remuneration conditions would motivate more women to engage in masculine domains and to gain access to higher paying jobs, thereby shrinking the gender pay gap. As outlined above, giving women higher decision-making power may also be beneficial for disadvantaged social groups. Recent research suggests that female managers tend to pay more equally than male managers, when pay is left to the discretion of the manager (Abraham, 2017). Several studies further revealed positive effects of female managers on gender equality in terms of pay and promotions among lower ranks (Norway, Kunze & Miller, 2017; see for a review Kulich et al., 2015). The increase of female representation in higher level positions may thus be an intervention to combat gender pay inequalities.

The second keys are the societal and organizational climates in regard of gender. An increase in the number of women may not automatically lead to positive outcomes in terms of equality. Women’s presence should be accompanied by valuing (gender) diversity in the organization. Indeed, negative effects, such as senior women being less supportive of other women, have been shown to occur when women feel discriminated against in the workplace (Derks, van Laar, & Ellemers, 2016). Conversely, pro-diversity organizational cultures have been shown to be associated with higher support among women and ethnic minorities (Paustian-Underdahl, King, Rogelberg, Kulich, & Gentry, 2017). Moreover, such a measure could avoid chronic salience of harmful gender stereotypes and thus, underperformance due to harmful backlash and stereotype threat effects. Establishing a context where women can act in congruency with gender stereotypes, such as negotiating for their work teams (gender congruent) instead for the self, could counteract women’s negotiation penalty. Another intervention could be to remunerate work in accordance to work inputs, rather than in relation to negotiation success which likely disadvantages women (Kulich et al., 2015).

The third key is transparency of the distribution of economic resources. Transparency obligations force employers, or funding bodies, to analyze their resource distributions in terms of gender and become aware of and prevent gender gaps. The establishment of transparent fixed pay-scales has been shown to efficiently attenuate the gender pay divide (see overview by Abraham, 2017). Legislation demanding firms to provide wage statistics for both genders may be particularly effective policy. A study with Danish firms recently revealed that it resulted in a significant reduction of the gender pay gap (Bennedsen, Simintzi, Tsoutsoura, & Wolfenzon, 2018). Furthermore, companies with higher transparency of recruitment methods tend to employ higher portions of women (Reskin & McBrier, 2000). Moreover, it helps victims of economic discrimination to obtain the information necessary to prove and effectively enforce their rights. In addition, knowing negotiation ranges also give women the confidence to make higher pay demands thereby leading to the attenuation of gender differences in negotiations (Mazei et al., 2015). Transparency of clear criteria that link objective standards to the access of economic resources would help those who are disadvantaged to overcome system justifying beliefs and to confront unequal treatment (Kray et al., 2004, 2005). Indeed, women and other low status individuals tend to be reluctant to attribute personal bad outcomes to discriminatory acts if performance-outcome relations are ambiguous (Ruggiero & Taylor, 1995). Beliefs that justify or legitimize social hierarchies, and meritocratic beliefs lead those disadvantaged to accept their social position and to refrain from confronting the discriminatory system (Jost & Kay, 2005; Pelham & Hetts, 2001; O’Brien, Major, & Gilbert, 2012). Finally, transparency may also be a sign of a more (gender) egalitarian organizational climate, attracting more women and minorities.

Conclusion

We argued here that dealing with gender inequality in economic resources can have beneficial consequences for all members of society. The reasons for inequality are to be found in a complex interplay of social factors leading to biased perceptions of women, job characteristics, and to self-limiting behaviors of women. Thus, interventions and policies should not aim on changing individual women’s attitudes and behaviors but rather the social system in which women are disadvantaged.