Gender Inequality and Trade

Abstract

ABSTRACT

Gender Disparity in Education and the International Competition for Foreign Direct Investment

“…Wage disparity may attract costoriented FDI, notably the off-shoring of labor-intensive parts of production. This would resemble the finding of Busse and Spielmann (2006) that wage disparity is positively associated with comparative advantage in laborintensive export production. Furthermore, the particular dimension of gender inequality matters not only for FDI but also more broadly for the economic development of the host countries (Jean Drèze and Amartya Sen 1989;Lant Pritchett and Lawrence H. Summers 1996;Stephanie Seguino 2000;Stephan Klasen 2002).…”

“…8 The insufficient country coverage especially may cause seriously biased results when analyzing FDI determinants (Shatz 2003;Matthias Busse, Jens Königer, and Peter Nunnenkamp 2008). Moreover, when available, wage data typically refer to the manufacturing sector only (Kucera 2002;Busse and Spielmann 2006). 9 This limitation is problematic, as FDI in developing countries increasingly consists of FDI in the services sector (United Nations Conference on Trade and Development [UNCTAD] 2004;Braunstein 2006).…”

“…Again, problems of reverse causality loom large (Braunstein 2006 [2002]). Moreover, gender-specific labor-market participation rates do not necessarily reflect discrimination but rather may be based on voluntary decisions of female workers (Busse and Spielmann 2006).…”

“…Some evidence exists on the links between gender inequality and trade. Matthias Busse and Christian Spielmann (2006) find that wage inequality is positively associated with comparative advantage in labor-intensive exports, whereas inequality in terms of labor-market participation and education is negatively related with such exports. According to Stephanie Seguino (1997), wage inequality may have contributed to the export success of countries such as South Korea.…”

Gender, Growth and Employment

“…A number of empirical studies support these predictions, finding female wages increasing relative to men's in a variety of country contexts and cross-sectionally as well (Wood, 1991;Milner and Wright, 1998;Tzannatos, 1999;World Bank, 2001;Paul-Mazumdar and Begum, 2002;Nicita and Razzaz, 2003;Black and Brainerd, 2004;Oostendorp, 2009). However, there is also substantial evidence that the gender wage gap -both absolute measures of the gap and the proportion of the gap attributable to discrimination -have either persisted or widened as a result of trade and investment liberalization (Mehra and Gammage, 1999;Artecona and Cunningham, 2002;Berik et al, 2004;UNRISD, 2005;Busse and Spielmann, 2006;Braunstein and Brenner, 2007;Menon and Rodgers, 2009). …”