Working Paper

The Intangible Gender Gap: An Asset Channel of Inequality

Abstract: We propose an "asset channel of inequality" that contributes to gender inequities. We establish that industries with low (high) gender pay gaps have high (low) shares of tangible assets. Because asset tangibility determines firms' ability to collateralize assets and borrow, credit conditions affect industries differently. We show that credit expansions further reduce the pay gap in low-pay-gap industries while leaving it unaffected in high-pay-gap industries, making low-pay-gap industries more appealing for women. Consequently, gender sorting across industries increases, which then cements gender roles and accentuates workplace gender bias. Ultimately, credit expansions help women "swim upstream" but also reinforce glass ceilings.

Keywords: Gender Pay Gap; Credit Markets; Asset Tangibility; Equitable Finance;

JEL Classification: J71; O16;

https://doi.org/10.17016/IFDP.2021.1322

Bibliographic Information

Provider: Board of Governors of the Federal Reserve System (U.S.)

Part of Series: International Finance Discussion Papers

Publication Date: 2021-08-03

Number: 1322