76 MBA grads
randomly selected using random numbers table
2. P. 205 Do men and women with the same job preferences and human capital receive comparable earning?
No, there was $200,000 difference in earnings between men and women in the same positions p. 209 p. 205: women have different earning even when their job preferences and investments in human capital are identical women are hired into lower paying jobs because employers and or recruiters have a bias against hiring or promoting women into higher-paying jobs 3. Be able to discuss where the greatest differential in earnings occur – by type of work on Wall Street? By gender? An interaction of the two? By cohort (e.g. point in career) By type of work (p. 210):
The greatest differential in earnings occurs at the highest levels of employment at the top of the wage chain. By the time Wall St workers get there the women have mostly been weeded out due to biases, the nature of the work; men hiring men unless there are no men available, and it takes 7 or so years to get that high so a lot of women have changed directions by getting married, starting families or succombing to the coercive forces and hostility within these occupations (p. 205) and “token” pressure (“revolving doors” metaphor) 4. What is the most important time period for receiving promotions? 206
first 4 years are long hard hours each week
first 7 years promotions are “lock-step” occur at regular intervals after 4 years promoted to vice pres
2-3 more yrs promoted to Senior vice pres
if can’t hang in there during first 4 years can never regain access to the profession’s fast track segregation occurs within first 5-7 yrs and determines professional track (206) with women being disproportionately pushed out of of the highest paying jobs
5. Describe the 3 types of work found in securities firms on Wall Street. Possible Essay topic!
3 broad areas on “sell side”
long unpredictable hours
more hours 80/week (206)
grunt work (206)
majority of financial compensation in form of year-end bonuses individual team members ranked in relation to one another and compensated accordingly (where does that leave female employees?) sales and trading
buy and sell securities
stressful during market hours
direct contact with clients
entertain clients after hours
divided into groups
in depth analysis of companies and market trends
advise investment bankers of companies that be advantageous prospective clients for underwriting or M&A business track stocks, scout for merger ideas, seek lucrative underwriting business, generate sales commissions support other functions
more predictable hours
$200-$350,000 in 97
3 areas on “buy side”
purchase stocks and bonds
purchase stocks and bonds
How did earnings vary by type of work?
some were more from commission, others from bonuses
Equity research $200,000 - $350,000
top ranking analysts $600k - over a million
highest income in corporate finance ($539) > sales and trading ($506) > public finance ($260) What role did bonuses play in total earnings?
Investment bankers received most of their compensation from year end Bonuses sales and trading received bonuses and/or commission
based on 3 variables
total firm revenues for the year
revenue production of group and proportionate contribution to firm’s profits performance of individual over a year relative to peers AS EVALUATED BY OTHERS WITHIN THE GROUP Which work...