Gender Gap in Willingness to Negotiate: the Role of Entitlements

Last registered on June 28, 2023

Pre-Trial

Trial Information

General Information

Title
Gender Gap in Willingness to Negotiate: the Role of Entitlements
RCT ID
AEARCTR-0011648
Initial registration date
June 25, 2023

Initial registration date is when the trial was registered.

It corresponds to when the registration was submitted to the Registry to be reviewed for publication.

First published
June 28, 2023, 4:37 PM EDT

First published corresponds to when the trial was first made public on the Registry after being reviewed.

Locations

Region

Primary Investigator

Affiliation
Austin Peay State University

Other Primary Investigator(s)

Additional Trial Information

Status
On going
Start date
2023-06-01
End date
2023-07-01
Secondary IDs
Prior work
This trial does not extend or rely on any prior RCTs.
Abstract
Economists and social psychologists have long been trying to determine the behavioral factors that result in gender gaps in economic outcomes. One underlying factor is suggested to be women's lower willingness to negotiate than men. The gender differences in levels of entitlement with respect to pay can explain the gender negotiation divide. This research stream suggests that women feel less deserving of higher pay than men, are unsure about the worth of their labor, have lower performance expectations, and take less credit for their success. Here, we study whether women’s concerns regarding what they think they are entitled to drive their lower likelihood of initiating negotiations. Women’s lack of entitlements may stem from the differences in how men and women evaluate themselves and compare own with other people. Using a controlled online experiment, we investigate the role of entitlements on gender differences in willingness to negotiate.
External Link(s)

Registration Citation

Citation
Demiral, Elif E. 2023. "Gender Gap in Willingness to Negotiate: the Role of Entitlements." AEA RCT Registry. June 28. https://doi.org/10.1257/rct.11648-1.0
Experimental Details

Interventions

Intervention(s)
We have three treatments. In the control (random) treatment, the workers are hired randomly. In the second treatment (entitlement) treatment, the workers are hired based on better performance. In the third treatment (unknown) workers do not know how they are hired, and reveal their beliefs about luck vs. performance playing a role in their hiring.
Intervention (Hidden)
Intervention Start Date
2023-06-01
Intervention End Date
2023-07-01

Primary Outcomes

Primary Outcomes (end points)
First, we measure the willingness to negotiate (binary choice). Next, if they choose to negotiate, we measure their negotiated amount. Lastly, we measure the beliefs regarding the relative importance of luck vs. performance playing on the hiring outcome.
Primary Outcomes (explanation)

Secondary Outcomes

Secondary Outcomes (end points)
Secondary Outcomes (explanation)

Experimental Design

Experimental Design
We run an online controlled experiment. We recruit two sets of subjects using the online research platform Prolific. The first group of participants acts as “Firms”, whereas the next group acts as the “Workers”. We plan to manipulate the formation of entitlements and feelings of deservingness by providing feedback on subjects’ relative (superior) ranks in one treatment and not in the others.

There are two parts of the experiment, and one part is randomly chosen for payment. In the first part, both the firms and the workers complete a real effort task (where they count the number of zeros in a series of matrices) within 90 seconds. Each correct answer pays the participants 5 cents in bonus. In part two, the instructions tell that each firm will be assigned two (2) workers. One of these two workers will end up getting hired by the firm. When a worker is hired by the firm, the firm gets an additional bonus of 100 cents as “hiring credit”. In addition to the hiring credit, the firm also earns an additional 10 cents for each correct answer the worker provided in stage one (so that the experimental setup is relevant to a real-life employee-employer relation, where employee performance determines the employer’s payoff). We call this firm payoff the firm profit. Of this firm profit, either 30, 40, or 50 cents (randomly determined) is suggested to be paid as a “suggested wage” to the hired worker. Non-hired workers do not get any payment from part 2.

Workers are then given a chance to negotiate for their wages. If they choose to negotiate, they are asked the amount of money (in cents) they demand from the firm. They are told that the firm may accept or reject this negotiation request. If rejected, both workers and firms lose 25 cents of their payoffs. If accepted, the worker gets the negotiated amount they asked for, and the firm gets the firm profit minus the negotiated wage.

We implement three treatments. The first treatment is the entitlement treatment. In the entitlement treatment, we match subjects acting as workers in pairs. The worker whose score is the highest in the pair is hired by the subject acting as the firm. This information is shared transparently with the hired worker and the firm. The second treatment is the random treatment. In the random treatment, one of the workers in the pair is randomly hired by the firm, and this information is made clear to both the worker and the firm. The third treatment is the unknown treatment. Here, both the workers and the firms do not learn about the hiring mechanism (which can be either random or based on performance -- as in entitlement treatment).

Our main hypothesis states that women will not initiate wage negotiations as much as men do in the control (random) treatment, where they will not know about their relative ranks, and that the fact they got hired is based on chance. This finding highlights a previously documented finding of the gender gap in willingness to negotiate. In the entitlement treatment, where both genders know about their relative ranks (that they are hired because they scored better in their pairs), we expect to evoke the senses of entitlement and deservingness, which would result in women negotiating more often and the gender negotiation gap shrinking. This defines our second hypothesis. We use the unknown treatment to test the role of beliefs in negotiation decisions. Aligned with the two previous hypotheses, we expect that female workers who believe they were hired because they performed better in the pair will negotiate more often than the women who believe it was driven by luck.
Experimental Design Details
Randomization Method
Programming language (Qualtrics) does the treatment randomization. Data collection for firms and workers happens in separate clusters with random order.
Randomization Unit
Treatment randomization is made for each individual participant.
Was the treatment clustered?
No

Experiment Characteristics

Sample size: planned number of clusters
Data is collected in 3-5 batches on Prolific with 200-500 participants in each batch.
Sample size: planned number of observations
We collect about 500 observations from the participants acting as firms and 1000 as workers.
Sample size (or number of clusters) by treatment arms
We collect about 100-200 observations for each role per treatment.
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
IRB

Institutional Review Boards (IRBs)

IRB Name
APSU
IRB Approval Date
2022-12-12
IRB Approval Number
22-067

Post-Trial

Post Trial Information

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Intervention

Is the intervention completed?
No
Data Collection Complete
Data Publication

Data Publication

Is public data available?
No

Program Files

Program Files
Reports, Papers & Other Materials

Relevant Paper(s)

Reports & Other Materials