Gender Equality and Economic Growth: A Rights Based Perspective

1
Gender Equality and Economic Growth A Rights
Based Perspective

• Diane Elson
• SID Presentation
• Amsterdam 19 Jan 2008

2
The Allure of Economic Growth

• Economic growth appears to provide more resources
  that can be used to meet development objectives,
  such as MDGs
• Economic progress widely judged in terms of
  economic growth as measured by increase in GDP
  per capita
• Falls in the rate of growth, and no growth, is
  widely viewed as a cause for concern

3
Some Doubts About Economic Growth

• Is growth illusory and unsustainable?
• Does the growth process really increase
  resources, or does it deplete resources and
  simply make output more visible by transferring
  it to the market?
• Is growth equitable?
• Does it require and create inequality?
• Does it exclude many groups of people?
• Does it entail deprivations that violate human
  rights ?

4
Gender Equality and Economic Growth A Variety of
Views

• Nobel laureate, Arthur Lewis, a founding father
  of development economics
• Mainstream economists such as Stephen Klasen
• Feminist economists such as Stephanie Seguino

5
Economic Growth Benefits Women Even More Than Men

• In his book on the theory of economic growth,
  Lewis was in no doubt about the benefits to
  women
• Women benefit from growth even more than men .
  . . Woman gains freedom from drudgery, is
  emancipated from the seclusion of the household,
  and gains at last the chance to be a full human
  being, exercising her mind and her talents in the
  same way as men (Lewis, 1955, p. 422).

6
Growth Reduces Womens Drudgery

• Arthur Lewis made this claim
• because most of the things which women
  otherwise do in the household can in fact be done
  much better or more cheaply outside, thanks to
  large scale economies of specialization, and also
  to the use of capital. (Grinding grain, fetching
  water from the river, making cloth, making
  clothes, cooking the midday meal, teaching
  children, nursing the sick etc.) (Lewis 1954, p.
  404).

7
Gender Equality in Education Promotes Economic
Growth

• Klasen (2002) finds that the higher gender gaps
  in education in sub-Saharan Africa, compared to
  East Asia, and their slower reduction, accounted
  for 0.6 percentage points in the 3.5 percentage
  points difference in the growth rates in the two
  regions in the period 196092.
• Closing the gender gap in enrolment in primary
  school by 2005 is a Millennium Development target
  An estimate of the impact on the economic growth
  of countries that were not on track to meet this
  target found that they would have grown faster by
  about 0.1 to 0.3 percentage points if they had
  been on track to close the gap (Abu-Ghaida and
  Klasen,2004).

8
Or is the Causation the Other Way Round?

• Robbins (1999) argued, in a study of six Latin
  American countries, that causation goes from
  increases in growth to increases in education of
  girls, rather than vice versa.
• He found that economic growth leads to rising
  educational attainment by drawing more women into
  the labour force, increasing the opportunity cost
  of womens time, and thus reducing fertility and
  leading families to invest more in the education
  of their (fewer) children, girls as well as boys.

9
Gender Equality in Participation in the Labour
Market Promotes Economic Growth

• Studies on the Middle East and North Africa
  (Klasen and Lamanna, 2003) and India
  (Esteve-Volart, 2004) suggest that growth would
  be higher if the gender gap in labour market
  participation were reduced (through more women
  entering the market).
• But is it higher growth that pulls more women
  into the labour market, rather than womens entry
  into labour market pushing up growth?
• In the global economic slow down, higher female
  participation rates might lead to higher female
  unemployment.

10
Gender Inequality in Wages Promotes Economic
Growth

• Seguino (2000)examines a set of export-oriented
  semi-industrialized countries between 1975 and
  1995.She finds that a 0.10 increase in the gender
  wage gap leads to a 0.15 percentage point
  increase in GDP growth.
• This means, for instance, that the difference in
  growth rates attributable to gender wage
  differentials for Korea (growth of 8.0 per cent a
  year ) and Chile (growth of 5.3 per cent) was 1.2
  percentage points per year.
• A second gender wage-gap measure that corrects
  for gender differences in education lowers the
  impact only slightly a 0.10 increase in the
  gender wage-gap level now leads to 0.10
  percentage point increase in GDP growth.

11
Or is the Causation the Other Way Round?

• It could be argued that it is the faster economic
  growth that has kept the gender wage gap high.
• If faster growth brings less educated, less
  skilled women into employment, then this will
  depress the average level of womens earnings and
  tend to widen the gender wage gap.

12
What Policy Conclusions Does the Research Point
To?

• If we put aside concerns about the direction of
  causation, we might conclude that to promote
  faster economic growth, a government should
• educate girls to the same level as boys,
• reduce barriers to womens participation in the
  labour market,
• but not act to reduce the gender wage gap.

13
Is this Advice in Compliance with Human Rights
Obligations?

• The Convention on the Elimination of All Forms of
  Discrimination Against Women (CEDAW) has been
  signed and ratified by most countries in the
  world.
• CEDAW places obligations on governments to
  eliminate all forms of discrimination against
  women.
• In so far as the gender wage gap reflects
  discrimination against women, the advice would
  not be compliant with CEDAW.

14
Compliance with Other Obligations

• Governments also have obligations to protect
  workers rights at work and to social security (
  see Int Cov on Econ Soc and Cultural Rights) and
  ILO Conventions).
• Informal employment, that lacks such rights, has
  being growing as a share of total employment
  (Standing, 1999).
• Women workers in developing countries are more
  concentrated than men in informal employment
  and within informal employment, in the more
  precarious types, with the lowest incomes (Chen
  et al., 2005).
• Rapid employment creation is necessary but not
  sufficient. Inclusion per se is not enough.

15
Is Human Rights Compliant Growth Possible?

• It requires well-regulated markets, monetary and
  fiscal policies focused on provision of decent
  work, industrial policy that promotes high
  productivity jobs, respect for the rights of
  workers to organize, and the use of taxation and
  public expenditure to provide public services,
  and redistribute income.
• Some of todays rich countries managed to
  combine economic growth with similar policies,
  and have the worlds best outcomes for gender
  equality.
• A similar policy package for todays developing
  countries is outlined by Seguino and Grown
  (2006), with a particular focus on womens
  rights. It emphasizes not growth through keeping
  labour cheap but through enabling labour to be
  more productive and returns to be fairly
  distributed.

16
Obstacles to a Human Rights Compliant Policy- and
New Opportunities

• Internal obstacles include elites acting to
  safeguard their own privileges.
• Also external obstacle, especially poorly
  regulated international markets, that put
  pressure on governments to compete by keeping
  labour cheap and failing to protect workers
  rights, and punish more progressive policies
  with capital flight.
• The global economic crisis has destroyed the case
  for this kind of regulation.
• New opportunities for new thinking.

17
References

• Abu-Ghaida, D. and S. Klasen (2004), The Costs
  of Missing the Millennium Development Goals on
  Gender Equity, World Development, 32 (7)
  10751107.
• Chen, M., J. Vanek, F. Lind, J. Heintz, R.
  Jhabvala and C. Bonner (2005),Women,Work and
  Poverty, New York UNIFEM.
• Esteve-Volart, B. (2004), Gender Discrimination
  and Growth Theory and Evidence from India,
  STICERD Development Economics Papers, Suntory and
  Toyota International Centres for Economic and
  Related Disciplines, London London School of
  Economics.
• Klasen, S. (2002), Low Schooling for Girls?
  Slower Growth for All?, World Bank Economic
  Review, 16 34573.
• Klasen, S. and F. Lamanna (2003), The Impact of
  Gender Equality in Education and Employment in
  the Middle East and North Africa, background
  paper for report on Gender and Development in
  Middle East and North Africa, Washington, DC
  World

18
References

• Lewis, W. Arthur (1954), Economic Development
  with Unlimited Supplies of Labour,Manchester
  School, 22 (2) 13991.
• Lewis, W. Arthur (1955), The Theory of Economic
  Growth, London Allen Unwin.
• Robbins,D. (1999), Gender, Human Capital and
  Growth Evidence from Six Latin American
  Countries, OECD Development Centre, Working
  Paper No 151, Paris OECD.
• Seguino, S. (2000), Gender Inequality and
  Economic Growth A Cross Country Analysis,
• World Development, 28 (7) 121130.
• Seguino, S. and C. Grown (2006), Gender Equity
  and Globalization, Journal of International
  Development, 18 (8) 1081104.
• Standing, G. (1999), Global Feminization
  Through Flexible Labor A Theme Revisited, World
  Development, 27 (3) 583602