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DFG sponsored research project - “Die Auswirkungen von Entgelttransparenz auf Beschäftigte, Betriebe und den Gender Pay" (The Effects of Pay Transparency on Employees, Plants, and the Gender Pay Gap)

The research project "Die Auswirkungen von Entgelttransparenz auf Beschäftigte, Betriebe und den Gender Pay Gap” is funded by the German Research Foundation (“Deutsche Forschungsgemeinschaft”, DFG, project number 416607985) with a duration of 2.5 years (January 2019 - June 2021) and an overall budget of approximately 240,000 Euros.

Transparency is a legislative and managerial mechanism for enhancing equity and equality in labor markets. Extant (psychological) research on pay transparency focuses on individual- level effects and has primarily been conducted in the lab (e.g. Bamberger & Belogolovsky, 2017; Belogolovsky, Bamberger, Alterman, & Wagner, 2016). Thus, we know little about the psychological effects of pay transparency in real world organizational settings.


Our research project starts here; it uses the German Transparency in Wage Structures Act (German: “EntgTranspG”) that went into effect in July 2017. Since January 6, 2018 employees from plants with more than 200 employees are given the right to ask for information about the average compensation level of a within-plant reference group. The goal of the law is to enhance equal pay and to decrease the gender pay gap in Germany.
To analyze the effectiveness of transparency regulations for achieving these goals, we exploit some quasi-random properties of the setting. We focus on both plant-level and individual-level effects of transparency. Plant- and individual-level data are supplemented with data from works councils to gain a broader institutional perspective on the topic.

Currently, the following data sources are developed and analyzed:

Plant data

Two samples with approximately 800 plants (equally split in treatment and control plants). Data were collected by SOKO (Bielefeld) through telephone interviews with plant or HR managers. Two panel data waves (Dec-Jan 17/18; Jan-Mar 19) with a panel participation of approximately 70 percent are available.

Employee data

Four samples with approximately 1,000 employees (equally split in treatment and control employees). Data were collected through online panel surveys managed by Qualtrics. Four independent data waves (Dec-Jan 17/18; May/June 18; Oct/Nov 18; Jan/Feb 19) are available.

Works council data

SOKO is currently conducting telephone interviews with works council representatives. Data will be available in May 2019.

In January 2020 all survey groups will be interviewed again.