Broad Influence: How Women Are Changing the Way America Works by Newton-Small Jay

Broad Influence: How Women Are Changing the Way America Works by Newton-Small Jay

Author:Newton-Small, Jay [Newton-Small, Jay]
Language: eng
Format: azw3
Publisher: Time
Published: 2016-01-04T16:00:00+00:00


There’s a good deal of evidence that women are inherently risk-averse. Almost all—97 percent—of microlending is done to women in the developing world. Microcredit started in Bangladesh in 1983 and has spread across the developing world since. Development banks give out small loans to individuals or groups to start small businesses. Some men in those cultures were too prone to drinking or gambling away the funds, but women have proved themselves trustworthy enough to use the money for business and family. Most of the world’s biggest microfinanciers will lend only to women.

A 2001 study of 35,000 U.S. households’ portfolio behaviors found that women’s transaction costs were lower—meaning they shifted investments less and so paid fewer fees—leading to higher net returns on investment. A 2009 study by researchers at the University of Hannover in Germany surveyed 649 fund managers in the U.S., Germany, Italy and Thailand and found that female fund managers were “more risk averse and shy away from competition in the tournament scenario”—meaning women didn’t like the idea of kill-or-be-killed, zero-sum games. And a 2012 study of 7,000 fund managers worldwide, 36 percent of whom were female, found that women were more cooperative and aimed at “fair play.” The study found that women rated higher than men in 12 of 16 leadership competencies, including “displays high integrity and honesty,” “develops others” and “builds relationships.”

Iceland is an oft-cited lesson in risk and the power of women to mitigate it. Iceland’s economy collapsed in the 2008 worldwide financial meltdown. Much like the United States, Iceland invested heavily in bad debt and overleveraged healthy assets, but Iceland’s is a small economy. The tiny island nation of just 300,000 with a gross domestic product of less than $20 billion experienced the most drastic bubble of the downturn, with a huge boom followed by a devastating bust. Two women who were appalled by the unhealthy risks their male co-workers were undertaking founded Audur Capital, a financial-services company with the goal of incorporating “feminine” values in the financial sector. They avoided investing in what they knew to be distressed debt and were literally the only Icelandic company to emerge from the crisis unscathed. The crisis led to a wave of women being elected to office, including Premier Jóhanna Sigurdardóttir.

Having more women on the trading floors may even chemically dampen risky behavior. Two University of Cambridge researchers measured the levels of steroids, including testosterone, adrenaline and cortisol, in 17 male traders over an eight-day period at a London bank. The traders with the highest levels of testosterone in tests of their morning saliva were more likely to reap more profitable trades. When a male trader hit a six-day winning streak, making more than double his daily profit, his testosterone levels were up 74 percent. In studies of lab animals, testosterone has been shown to increase risk taking and fearlessness. The risk is that bankers and traders are training their bodies to create financial bubbles, according to researchers John Coates, a former Goldman Sachs and Deutsche Bank trader turned neuroscientist, and Joe Hebert.



Download



Copyright Disclaimer:
This site does not store any files on its server. We only index and link to content provided by other sites. Please contact the content providers to delete copyright contents if any and email us, we'll remove relevant links or contents immediately.