Individuals are not born equal. They differ by level of intelligence or innate cognitive ability. It follows that the smartest people have a comparative advantage in problem solving than others. In modern economies, efficiency requires that the smartest people are matched to leadership positions. As poor decisions at the top of hierarchical organizations produce enormous damage, spilling cascades on underlying layers, senior positions should be entrusted to the smartest minds in order to minimize the risk of error.
Yet, while psychological research has shown that intelligence is equally distributed between men and women, the glass ceiling literature signals that all over the world the higher the rank, the smaller the proportion of women. Hence, there is a waste of intelligence and a sub-optimal match between individuals and jobs within economies.
In our paper, “Unfair tournaments: Gender stereotyping and wage discrimination among Italian graduates,” we use tournament theory, which emphasizes the role of intelligence as the main determinant of rank and regards competition as an efficient method to match individuals with jobs in hierarchical organizations. The theory stresses that efficiency is achieved only if the tournaments are fair, that is if none of the participants are discriminated against by the rules of the game.
But the competition for a career in the real world are not fair towards women. A substantial literature shows that because of stereotypes, an identical performance is systematically underestimated if attributed to a woman rather than a man, thus revealing the existence of gender discrimination.
We show that in contexts where stereotypes are most likely to occur, tournaments are least fair when employers are less motivated to make accurate judgments on employees, as in unskilled jobs and temporary work. On the contrary, the tournaments are the most fair in highly specialized occupations and permanent wage contracts, and when employees are recruited through open competition; that is, through procedures where performance appraisal is more structured and less ambiguous, thereby reducing the conditions for gender stereotypes to flourish.
The image below represents a hierarchical structure that has nearly the same number of men and women, with intelligence equally distributed between men and women. The arrows represent the career paths, and the red line represents the glass ceiling that prevents the top women from reaching the top. Every senior position missed out by a clever woman due to the glass ceiling, will be replaced by a less-clever man.
By Carolina Castagnetti and Luisa Rosti on their article “Unfair tournaments: gender stereotyping and wage discrimination among Italian graduates,” published in the October 2013 issue of Gender & Society.