Money, Merits and Gender: Essays on wage differentials

Academic Dissertation


Workers in finance are paid about 20 percent higher wages than similar workers in other fields. This finance wage premium is larger for men than it is for women, and the gender difference in this premium becomes greater towards the top end of the wage distribution, indicative of a glass ceiling effect in finance.

The share of women managers in finance has increased over time. The literature has shown that women can increase their probability of promotion through higher education. I show that indeed higher education increases the probability of promotion of women, however, the effect of higher education on the probability of promotion is larger for men than it is for women. Similarly, I show that firm specific human capital has a larger effect on men’s promotion probability than women’s. I show that wage increases upon promotion are smaller for women than they are for men.

Wage differentials between workers in banks with different ownership structures are studied. I show that workers in profit-maximizing shareholder banks are paid more than workers in stakeholder banks, such as cooperative or savings banks. Wage dispersion on the other hand is lower in stakeholder banks.

Keywords: Wage differentials, finance wage premium, gender wage gap

Taloudellisen lukutaidon perusta Saara Vaahtoniemi

Saara Vaahtoniemi

economist, D.Sc.(Econ)

Work Package "Game-based approaches and digital tools in financial education"

Pellervo Economic Research PTT

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