Women in corporate leadership positions may be less likely to lay off employees than men, concluded a new study conducted by David Matsa, an assistant professor of finance at the Kellogg School of Management. and Amalia Miller, an associate professor at the University of Virginia, and discussed in Kellogg Insight.

The publication noted that “Earlier work in social psychology and management had found that men and women do indeed have disparate management styles, with women tending to interact and communicate with their subordinates differently than men.” But beyond mere “style,” the study looked to see if any such differences have any impact on the business of the corporation.

Matsa and Miller looked at Norway, which in 2006 adopted a quota mandating that all publicly held companies had to have 40% female board members within 2 years. They found that this female quota changed only the gender composition of the boards and nothing else about the companies, which permitted them to see what impact, if any, the increased number of females on the board had on the business of the companies.

The results showed that the quota had no effect on revenues, most costs, and rates of mergers and acquisitions, but although wages were not higher, nonetheless “labor costs” were higher. Their conclusion? “[I]t was coming from higher relative employment” — these companies were laying off fewer employees


Matsa said that “the Norway results don’t seem to be specific to the quota [because] [e]ven in a setting without a quota, you still see a similar pattern.” Matsa and Miller speculate that perhaps female leaders have different values, which might make them less likely to lay off workers, or that they may see this as a good long-term economic strategy.