Social Scientists Conduct Research on Gender Equity in US Banking Systems through Tomlanovich-Diamond Fund

November 30, 2022 - Emily Jodway

Dr. Cristina Bodea, a professor in the department of Political Science, recently published a summary of her research on the relationship between gender and trust in the U.S Federal Reserve (Fed). The findings were highlighted in the The Conversation

The research was funded through the Tomlanovich-Diamond Research Equity Fund, a research fund developed through MSU’s Women’s Leadership Institute (WLI). This fund awards faculty and undergraduate research teams support for projects that focus on equity issues and align with the WLI’s vision of advancing leadership equity for women globally. This was one of the two inaugural awards given out by the Tomlanovich-Diamond fund. 

Dr. Bodea, along with research partner Dr. Andrew Kerner, found that Americans are less likely to trust statements from the Federal Reserve about interest rates when a U.S. central bank official portrayed as a woman delivers the information as opposed to a man. 

“To better understand how gender shapes public reactions to central bankers, we conducted a survey experiment in January 2022 in which we gave easy-to-understand summaries of contemporary Fed statements to a random sample of about 11,000 Americans, evenly split between men and women.” Bodea explained in The Conversation. “We randomly attributed those summaries to real people, Chicago bankers Loretta Mester and Charles Evans, which allowed us to gauge whether the words of a female central banker would be perceived differently than those of a male colleague.”

The team asked participants general questions including their level of trust in both state and federal institutions, then moved on to more specific questions about their trust in the Federal Reserve, optimism about the economy and concerns about unemployment and inflation. They found strong evidence of bias against female bankers amongst male survey takers, most prevalent when asked about survey takers’ confidence in the Fed. 

“For example, 53 percent of male respondents said they had confidence in the central bank when Evans was cited as the source, compared with just 43 percent who said the same about a similarly credentialed Mester. Similarly, 32 percent said they were optimistic about the economy when the summary came from Evans, double the share for Mester.”

Bodea and her team plan to continue this research by conducting surveys in Europe and Japan to see if similar types of gender bias are reflected worldwide. 

“Since a key element of reducing inflation is convincing investors, companies and consumers to trust that the central bank can succeed, our study suggests female central bankers are at a disadvantage in generating public trust, which hurts their efficacy as communicators,” Bodea explained. “This may also put the trend of more female bankers at risk unless perceptions change.” 

Bodea was also recently named a Mason Soneral Faculty Fellow, named one of the founding executive board members of the WLI, Christine Mason Soneral. Bodea is the second-ever Mason Soneral fellow, joining WLI director Amanda Guinot Talbot in receiving the honor. 

“I am so grateful for the research support through the Tomlanovich-Diamond fund and the Mason Soneral fellowship,” Bodea said. “The WLI board has been doing such great work on behalf of our students and the new foray into supporting research is a testament to the board members embracing the full mission of the University. For me personally, it has been such a rewarding experience to meet the board members and exchange views on the role of women as leaders in our society.”