What Having a Daughter Does to a Boss: New Economic Study Reveals Shifts
A new economic study reveals that male managers tend to hire more women and increase their wages after having a daughter, without harming overall business productivity.
A new economic study published under the headline "What having a daughter does to a boss" reveals a surprising link between a manager's personal life and workplace decisions. Researchers Maddalena Ronchi of Northwestern University and Prof. Nina Smith of Aarhus University analyzed administrative data from Statistics Denmark covering the years 1993 to 2017. They focused on male managers in small businesses with a single manager who personally handles hiring and compensation.
The findings show that after the birth of a first daughter, the relative wages of women in the business rose by 4.4%, and their employment rate increased by 2.9%. This shift was primarily driven by new hires, as managers replaced male employees with equally qualified female workers in lucrative, full-time roles. Crucially, this transition did not harm business performance, with labor costs, sales, and productivity remaining stable.
Causal Impact and Permanent Shift
Because the gender of a child is a matter of chance, the researchers could establish a causal link rather than a mere statistical correlation. The effect emerged immediately after birth and persisted for years. According to the researchers, this rapid change indicates a fundamental shift in how managers perceive women rather than a long-term strategy for their daughters' future labor markets.
"When I saw the results, I thought it was almost too good to be true," said Prof. Smith.
Limitations of the Study
While groundbreaking, the study focuses on small businesses in Denmark, a nation with unique labor market norms. It remains uncertain whether identical trends would manifest in large corporations where hiring decisions are filtered through human resources departments or in different economic sectors.
