Gender Differences

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Editor: Morris Altman
Date: 2015
Document Type: Topic overview
Pages: 2
Content Level: (Level 5)

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Gender Differences

Testing for differences in preferences between genders has been a focus of economic research for many years, particularly in the areas of labor economics and the economics of the household. For example, early work by Gary Becker (1965) and Claudia Golden (1990) has delineated the ways in which incentives may vary across genders and how social institutions may shape these incentives and motivate different behaviors across genders. Many researchers (such as Daly and Wilson 1978 , 1988 ) have taken an alternate approach to gender differences, focusing on evolutionary bases for the emergence of differences in contemporary behavior. Taking a more behavioral approach to identifying and understanding gender differences in behavior, Croson and Gneezy (2009) review findings from experimental economics regarding differences across risk preferences, social preferences, and preferences toward competition. While there are significant variations in specific findings, several stylized facts emerge from the experimental research on gender differences. For example, women are typically observed to be more risk-averse than men, though this difference disappears among professional managers and those with knowledge of financial investments. Women frequently respond less favorably to competitive environments than men. Finally, men and women frequently demonstrate different social preferences, though Croson and Gneezy make the case that such results could be a side-effect of women’s overall greater propensity to react to contextual changes in experiments. These findings all shed light on the labor market, educational, and social differences identified by researchers such as Becker (1965 , 1976 ), Daly and Wilson (1978 , 1988 ) and Goldin (1990) .

The difference in risk preference between men and women is the most widely demonstrated and robust gender difference in economic experiments. In almost all contexts, men show a greater incidence of risk taking than do women. With risk differences established, researchers have sought explanations for this behavior. Psychological research suggests that women experience emotions more strongly than men and that this can affect the utility of a risky choice. In experiments, women have reported more intense nervousness and fear in anticipation of negative outcomes than men, resulting in greater observed risk aversion among women. Similarly, experiments have demonstrated that identical situations can motivate anger in men and fear in women ( Daly and Wilson 1978 ). When paired with findings that anger evaluates gambling behavior (risk taking), it is possible that men underestimate risk, leading to observed differences in risk preferences.

In economic experiments, women respond less favorably to competitive environments than do men. Researchers have observed improved performance from men when faced with a competitive incentive to perform a task rather than a piece-rate incentive but no similar improvement from women. This gender difference has also been observed in children, leading to the suggestion that the difference stems more from “nature” than from “nurture,” as children are less likely to have assumed strong gender identities before puberty. This preference for competition is important in labor policy, where it has been suggested by some researchers that wage gaps are affected by women bargaining less competitively.

Experimental research has demonstrated important gender differences in social preferences, including inequality aversion, altruism, envy, trust, and reciprocity. Page 175  |  Top of ArticleThese findings have relied on observed differences in behavior between individuals in simple economic games (ultimatum, dictator, and trust games). However, the results are consistent across decision environments: women are typically more concerned with equality, while men demonstrate preferences for efficiency. Results on differences in levels of trust and contributions to public goods have been more mixed.

Croson and Gneezy (2009) offer evidence that women’s choices are more sensitive to the experimental environment, insofar as their responses to contextual changes are larger than those of men. For example, in an ultimatum game where the gender of the proposer is known, men show less variation in their rejection rate by the gender of their opponent than do women. In dictator games, women increase the amount offered once they move from an anonymous opponent to one of known gender.

It is also important to note that gender differences in choices can also be affected by institutional parameters such as the power relationship (a point of significance to Herbert Simon’s perspective on behavioral economics) between decision makers in terms of, for example, the number of children, household expenditure, and the division of labor. As well, the norms and social values instilled in the household, school, and work environment also can significantly affect the extent to which choices are gendered.

Kevin Laughren and Robert Oxoby

Further Reading

Altman, M., and L. Lamontagne. 2004. “Gender, Human Capabilities and Culture within the Household Economy: Different Path to Socioeconomic Well-Being?” International Journal of Social Economics 31: 325–364.

Becker, Gary. 1965. “A Theory of the Allocation of Time.” Economic Journal 75: 493–517.

Becker, Gary. 1976. The Economic Approach to Human Behavior. Chicago: University of Chicago Press.

Daly, Martin, and Margo Wilson. 1978. Sex, Evolution, and Behavior. New Brunswick, NJ: Transaction Press.

Daly, Martin, and Margo Wilson. 1988. Homicide. New Brunswick, NJ: Transaction Press.

Croson, Rachel, and Uri Gneezy. 2009. “Gender Differences in Preferences.” Journal of Economic Literature 47: 448–474.

Folbre, Nancy. 1983. “Of Patriarchy Born: The Economy of Fertility Decisions.” Feminist Studies 9: 261–284.

Golden, Claudia. 1990. Understanding the Gender Gap: An Economic History of American Women. Oxford: Oxford University Press.

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Source Citation   

Gale Document Number: GALE|CX6200200105