Knowing When to Ask: The Cost of Leaning In
Although women may financially benefit from choosing to negotiate in some cases, there are other cases in which increased negotiation can negatively impact women and result in less pay.
Cite this Article
Exley, Christine L., et al. "Knowing When to Ask: The Cost of Leaning in." Journal of Political Economy, 2020. DOI: 10.1086/704616.
Exley, C.L., Niederle, Muriel, & Vesterlund, Lise. (2020). Knowing when to ask: the cost of leaning in. Journal of Political Economy. DOI: 10.1086/704616.
Exley, Christine L., Muriel Niederle, and Lise Vesterlund. "Knowing When to Ask: The Cost of Leaning in." Journal of Political Economy (2020). DOI: 10.1086/704616.
Authors
This article was written by , and , and was originally published by Journal of Political Economy in March of 2020The concept of “lean in,” popularized by Sheryl Sandberg in 2013, refers to the notion that women should engage more actively in workplace settings in order to close the gender gap. One behavior that is encouraged by this concept is women “leaning in” to more actively negotiate their compensation. This suggestion has been received with widespread acceptance: 75% of U.S. adults report that women should negotiate their salaries more often.
However, the research on women’s salary negotiations is mixed. There is some evidence that increased negotiation may benefit women, but that it can also lead to backlash. For example, one study found that women who negotiated were twice as likely as men who negotiated to experience negative social costs, such as being seen as an undesirable job candidate. Additionally, negotiations can be financially costly because of the time and money that employees have to spend on them.
In this study, researchers investigated whether negotiating more often led to increased financial benefits for women. This hypothesis was tested by comparing whether groups of women who selectively chose when to negotiate were more or less likely to be rewarded with increased pay than groups of women who were required to negotiate in every compensation situation. These outcomes were also compared to those of men, who were subject to the same experiment. This set-up allowed the researchers to determine whether women negotiating more frequently resulted in financial gain or financial loss—that is, would the groups of women who negotiated during every compensation interaction experience higher salaries than the groups of women who only negotiated selectively?
Although women may financially benefit from choosing to negotiate in some individual cases, in this experiment, negotiating unselectively (i.e., in every circumstance) resulted in negative financial outcomes for women.
- When women elected to enter or not enter into negotiations, they were accurately judging whether the negotiation would result in gains or losses.
- When women elected to negotiate their compensation, they benefited by receiving increased compensation.
- However, when women negotiated compensation involuntarily, they did not receive increased compensation.
- The outcomes were similar for men. Men did not benefit financially from negotiating in every situation and instead experienced greater financial loss.
- Although increased negotiation was harmful for both women and men, it was more harmful for women, causing them significantly greater financial loss than men.
These findings remind researchers and organizations to be cautious when encouraging women to increase their compensation by negotiating in every situation: forcing women to negotiate can do more harm than good in terms of financial outcomes.
Researchers conducted a series of experiments to test whether increasing negotiation actually benefited women and men. The first set of experiments was conducted at Stanford University in 2013 and included 292 participants. The second set of experiments was conducted at the University of Pittsburgh in 2018 and included 398 participants. Participants were randomly assigned to one of two groups: in one group, workers had a choice of whether or not to negotiate their compensation, and in the other group, workers were required to negotiate their compensation in every situation.
Each participant was randomly assigned either to the role of worker or firm representative for the entirety of the experiment. The workers were asked to participate in a “real-effort” task, and based on their performance, they were placed into a tier of compensation. The task for the first set of experiments was to calculate the sum of five two-digit numbers. The task for the second set of experiments was to count the number of zeros in a table containing zeros and ones. Once each worker was assigned to a compensation tier based on their performance ($5, $10, etc.), they were randomly assigned to a “suggested bonus,” which was either less than, equal to, or greater than the employee’s contribution. If the parties could not reach an agreement in terms of pay, both the worker and the firm were penalized with a $5 pay deduction.
The researchers collected participant demographic data to analyze the outcomes of each experiment by the gender of the participants. They then explored whether participants elected to negotiate (if they were in the “choice” condition), and what the compensation outcomes were for the two different groups (those who chose to negotiate versus those who were always forced to negotiate).
Cite this Article
Exley, Christine L., et al. "Knowing When to Ask: The Cost of Leaning in." Journal of Political Economy, 2020. DOI: 10.1086/704616.
Exley, C.L., Niederle, Muriel, & Vesterlund, Lise. (2020). Knowing when to ask: the cost of leaning in. Journal of Political Economy. DOI: 10.1086/704616.
Exley, Christine L., Muriel Niederle, and Lise Vesterlund. "Knowing When to Ask: The Cost of Leaning in." Journal of Political Economy (2020). DOI: 10.1086/704616.
