Selection into Leadership and Dishonest Behavior of Leaders: A Gender Experiment

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Leaders often weigh ethical against monetary consequences. We experimentally study such a dilemma where leaders can benefit their groups at the expense of moral costs. First, we measure individual dishonesty preferences and, second, leaders’ reporting decisions for a group by using payoff-reporting games. We focus on an endogenous leadership setting, where subjects can apply for leadership. Women have less pronounced dishonesty preferences than men, but increase dishonesty as leaders. The increase disappears when leadership is randomly assigned. A follow-up study reveals that women leaders behave dishonestly when they believe their group members prefer dishonesty.