Sex Discrimination and Market Concentration: The Case of the Banking Industry

Abstract

In this paper, we have examined the relationship between market structure and employment discrimination using an especially constructed data set that links microeconomic data on female employment and indicators of market concen- tration in the banking industry. By using firm-specific data relating to the banking industry, it has been possible to estimate the relationship between market concentration and relative female employment in a way that avoids the aggregation problem and interindustry differences that have been so troublesome in previous examinations of this question. We have two important empirical results to report. First, we find strong support for a negative relationship between market concentration and relative female employment. The results are robust with respect to both model specifica- tion and measure of market concentration used. Second, we have been able to determine that individual bank market shares are unrelated to relative female employment, confirming that the relationship between male/female employment ratios and market concentration in our data is due primarily to differences across markets rather than individual banks.