Competence, Desert and Trust — Why are Women Penalized in Online Product Market Interactions?

Why do women sellers in product markets receive lower prices than men sellers when selling the same identical products? This Article investigates the effects of cultural beliefs about competence, desert and trust on market interactions with women and men sellers. We use an experimental approach to show that the prices people are willing to pay for the exact same product are affected by cultural beliefs about gender; when a woman sells a gift card, she is likely to receive five percent less for it, compared to when a man does. Our analysis further suggests that it is beliefs about women’s relative competence and moral entitlement that drive the gender price gap in product markets. When the participants in the experiment were presented with information that suggested that the woman seller was a competent or entitled seller, no gender price differences were found between such women sellers and their equally qualified male counterparts. Nonetheless, information about the trustworthiness of sellers did not decrease the gap between women and men sellers. This suggests that price gaps between women and men in product markets are not generated by beliefs about the trustworthiness of women and men.