Do all women get benefits from formalization? Lessons from a firm study in Korea

• In Event: 2451 - Section on Organizations, Occupations, and Work Refereed Roundtables (1 hour)
  In Refereed Roundtable 60min: Table 20. Representation and Inclusivity I

Abstract

Does the formalization of personnel management restrain discriminatory managerial decisions and reduce the gender penalty in organizations? Or does it induce even more gender stereotypes and perpetuate gender inequality? Or does the effect of formalization differ by women’s position in the wage hierarchy? Despite incremental interests on adjudicating the effect of formalization as an organizational condition for gender equality, not many empirical studies were able to address this issue due to its stringent data requirement for the establishment of causality; even fewer studies investigated it with organizational data. This paper examines the effect of formalization using the personnel data (2008-2017) from a large Korean company, which underwent a comprehensive change in the pay system in 2014. Unconditional quantile regression analyses reveal that formalization reduced the female disadvantage significantly in the lower decile groups but rather increased it in the higher decile groups. Making job boundaries clear and bonding job titles to pay might have reduced various arbitrary decisions that used to be made in favor of men at the bottom of wage distribution but not at the top.

Author

• Young-Mi Kim, Yonsei University