Is this a man’s world? The effect of gender diversity and gender equality on firm innovativeness

by Daniela Ritter-Hayashi, Patrick Vermeulen, Joris Knoben

Gender diversity is known to have a positive effect on innovation in developed countries. However, it is unclear whether the benefits of gender diversity for innovation also apply to the particular context of developing countries, which is characterized by diverse and lower levels of gender equality. We propose that gender diversity positively impacts innovation in the developing countries participating in our study. In addition, we expect that this effect is moderated by country-specific levels of gender equality. In a cross-country study covering 18,547 firms in 15 developing countries, we find that gender diversity among a firm’s owners and workforce as well as having a female top manager benefit innovation in developing countries. Yet, contradictory to our expectations, gender equality does not significantly moderate this relationship. As such, our results underline the importance of enabling and fostering gender diversity and have critical implications for firms and policy makers alike.