Gender, Pay Transparency, and Competitiveness: Why Salary Information Sometimes, but Not Always, Mitigates Gender Gaps in Salary Negotiations

Although pay transparency is a widely accepted remedy for the gender pay gap, research has devoted little attention to the specific types of salary information that are available to job seekers and whether the framing of this information moderates gender differences in negotiation outcomes. We first conducted an exploratory study to investigate whether men and women differ in how much they rely on and perceive the usefulness of various sources of salary information. A survey of experienced MBA students revealed that, relative to women, men tend to place greater value on sources that involve direct social comparisons (e.g., professional networks) as opposed to more aggregate, general sources (e.g., websites). We then conducted a controlled experiment using a hypothetical job offer negotiation to determine whether framing salary information in terms of social comparison moderates gender gaps in salary requests. Our results supported a moderated mediation model, revealing that men requested higher salaries than women when presented with upward social comparison information (i.e., what a more qualified employee earns), but not downward (i.e., what a less qualified employee earns) or lateral comparison information (i.e., what a similarly qualified employee earns). These effects were driven by heightened competitiveness among men. We also discovered that both men and women experienced the greatest boost in competitiveness and salary requests when presented with downward social comparison information. Overall, salary information is effective in reducing gender gaps, but the effects are nuanced, as they depend on the social comparison inherent to the information.