National Culture and Female Leader Selection: Evidence from Microfinance Institutions Around the World

• In Event: Potpourri (PI, GNP, Diversity)

Abstract

We investigate the role of national culture in female manager appointments. We argue that culture influences female manager appointments through its effects on managerial decision-making. Using firm-level data on 1032 microfinance institutions (MFIs) across 59 countries, we show that, both individualism and uncertainty avoidance have negative and significant associations, whereas power distance has a positive and significant association with female manager appointments. We demonstrate that greater number of female non-managers reduces (increases) the appointment of female managers in high uncertainty avoidance (individualistic) cultures. Our findings challenge the “one size fit all” approach adopted by policymakers around the world to reduce gender inequality. Our results are robust to endogeneity and alternative estimation techniques.

Author

• Ernest Gyapong, massey University