XIAOMENG LI

WORKING PAPERS

"Learning the Major: The Value of Course-Taking in College Major Choice" [Draft coming soon!]

"Lean In or Shy Away? Workers’ Responses to Gender Pay Gap Transparency" [PDF] Submitted!

This study examines the effects of gender pay gap transparency on workplace recommendations, beliefs about labor market experiences, wage negotiation, and job applications. I first present survey evidence showing that, across workplace contexts, jobs with a transparent gender pay gap are less likely to be recommended to women and are expected to offer them worse pay, promotion prospects, and workplace treatment. In addition, I design an experiment to test workers’ willingness to ask for higher pay when pay gap information is either provided or withheld. I find that there is no substantial gender gap when such information is absent, but a significant gap emerges when it is made transparent. Specifically, women are much less likely than men to request higher wages when they learn that prior interactions with their counterpart resulted in outcomes favoring men. This highlights an unintended consequence of pay gap transparency: rather than encouraging women to negotiate, it discourages them, widening the gender gap in asking for higher wages. However, this effect disappears when workers face conditions that remove concerns about rejection or gender discrimination. In another part of the experiment, I also examine behavioral responses at the job application margin and find that women are similarly less likely to apply for jobs when the associated pay gap is made transparent, leading to increased gender imbalance in both applications submitted and jobs accepted.

"Information-Optional Policies and the Gender Concealment Gap" (with Christine Exley, Raymond Fisman, Judd Kessler, Louis-Pierre Lepage, Corinne Low, Xiaoyue Shan, Mattie Toma, and Basit Zafar). [PDF] [NBER Link]

We identify and explore a gender concealment gap when individuals have the opportunity to hide information about their performance from others. In data from two universities that allowed students to replace letter grades with "credit" on their transcripts, we find that men are substantially more likely than women to conceal grades that will harm their GPAs. The gender concealment gap persists across student traits and course features and generates inequity: the option to conceal leads to GPA gains that are 50% larger for men than for women. University data and complementary experimental evidence suggests that women may conceal less because they expect others will make worse inferences about their concealed grades.   

"Anticipated Discrimination and Major Choice" (with Louis-Pierre Lepage and Basit Zafar). [NBER Link]

We study whether gender differences in university major choices result from anticipated labor market discrimination. First, we document two novel facts using administrative transcript records from a large Midwestern university: women are less likely to study science, technology, engineering, and mathematics (STEM) as well as business and economics, but 1) those who do are positively selected on ability, and 2) obtain higher grades conditional on ability. Second, we show that these facts are consistent with a signaling model in which women anticipate greater labor market discrimination in STEM, business, and economics than in other fields. Third, we provide direct empirical evidence of anticipated discrimination using a student survey. The survey reveals striking patterns of anticipated discrimination by women, particularly in STEM, business, and economics, affecting both expected economic outcomes such as wages as well as expected workplace conditions. We conclude by showing that anticipated discrimination explains women's course taking and intended major choices, but not men's.

"Moral Hazard and the Sustainability of Income-Driven Repayment Plans" (with Chao Fu and Basit Zafar). [NBER Link]

Income-Driven Repayment (IDR) plans tie student loan repayment to income and forgive unpaid debt after a certain number of years of repayment. We investigate how these features affect one's career choices through a survey where the same student is asked to select job profiles under various repayment plans. Consistent with our Ben-Porath style model, the survey results reveal that IDR is a double-edged sword. On the one hand, 36% of students underinvest in their human capital under the standard repayment plan relative to their would-be choices in a debt-free scenario; an IDR resembling the Saving on a Valuable Education (SAVE) plan reduces this fraction to 20%. On the other hand, IDRs induce moral hazard: under a SAVE-like plan, 22% of students choose job profiles with lower initial wages and higher wage growth than their choices in a debt-free scenario, leaving part of their debt forgiven. A back-of-the-envelope calculation indicates that this type of moral hazard alone would render SAVE-like plans unviable were they carried out by private lenders; however, government-run IDRs are sustainable due to the government's ability to collect lifetime income taxes.

WORK IN PROGRESS

"Study and Play? The Multi-Dimensional Human Capital of College Student Athletes" (with Soyoung Han and Georgy Shukaylo).