The Strength of Female Leadership: Gender Discrimination, Network Penalties, and Firm Innovation in China

• In Event: 1450 - Foreign aid, NGOs, and Private Corporations in Women's Lives

Abstract

An increasing number of empirical studies reveal the benefits for organizational outcomes if gendered organizational stereotypes such as male-dominated leadership are broken free at workplace, focusing on the processes, mechanisms, and consequences of gender inequality in developed economies and the relatively mature markets. However, this recent scholarship pays less attention to the practices of gender discrimination in transitional economies and developing contexts where women suffer from pervasive and deep-seated gender discrimination in both societal and organizational realms, while simultaneously having to fight with the absence or deficiencies of formal institutions in carrying out business activities on a regular basis. In this study, we analyze a nationally representative sample of Chinese private companies and examine how a firm’s female top-manager shapes firm innovativeness and interacts with the firm’s social ties as well as its institutional environment in affecting firm innovativeness. We find a positive association between female top-management and firm innovativeness, but the positive effects of female leadership in promoting firm innovativeness are weaker among the firms with more social networks, showing clear evidence for the network penalties facing women in the business world. Moreover, we find that female management plays a stronger role in promoting the firm’s innovation output in the regions with a higher degree of marketization. It suggests that although increased marketization is often associated with more competition and higher uncertainty, the advancement of formal institutions in the developing contexts helps reduce gender disadvantages for women who can enjoy their outsider status in a more diverse, open system.

Authors

• Junmin Wang, University of Memphis

• Kaniz Fatema, University of Memphis

• Caroline Reilly, University of Memphis