How Long Should You Stay at a Financial Job: Are Men and Women Different?

Using the career histories from LinkedIn data, this paper investigates whether the gender differences in representation and quit probabilities in the finance industry is related to gender difference in preference for competition. We estimate a difference-in-difference model by exploiting an exogeneous shock caused by the removing of “rank and yank” performance appraisal system in the US listed financial firms, which clearly reduces the level of competition within a workplace. We find that women have higher quit probabilities than men in the finance industry, but the removing of "rank and yank" system significantly increases women’s work durations in the industry and narrowed the gender gap in quit probabilities. The evidence indicates that gender differences in the preference for competition may contribute to explain women’s under-representation and higher quit rate in the finance industry.