Women’s autonomy and economic development

Greater empowerment and independence is a worthy goal, in itself, for all individuals. In the past few decades, a number of development economists have focused on the more specific question of how improvements in women’s empowerment—expanding opportunities for education, jobs, health care, and public participation, along with protection from violence—can enhance a country’s economic development. Siwan Anderson discusses the connections between these multiple dimensions of empowerment in Ennis’ lecture on “Decoupling Female Autonomy,” which was presented as part of the Economics of Canada meetings in June 2022, and is now published in the November 2022 issue of Canadian Journal of Economics.

Here are some of the topics that caught my attention. Anderson writes:

Women’s empowerment is a multifaceted concept aimed at: improving women’s ability to make decisions in the family, reducing violence against women, increasing the market and political opportunities, equality in legal rights, and dismantling customs and norms that are biased against women. While the multifaceted nature of women’s empowerment is appreciated by academics and policy makers alike, it is not well understood how the various dimensions interact and evolve with each other or with society as a whole.

Perhaps the classic argument in this area is that empowered women invest more in children.

[This] The move to argue that the relative empowerment of females leads to better economic development seems to be based on the assumption (and accompanying evidence) that women and men have different preferences. and health of men. Because both are critical determinants of human capital formation and human capital formation is at least a direct cause of economic development, development will be promoted by factors that improve women’s autonomy (or women’s external choice) in relation to their husbands through the channel of increasing their control over the allocation of family resources.

It follows that finding ways to tip the balance within the family to greater autonomy for women, and greater control over family spending, can have major payoffs.

The standard model of family decisions as a bargaining process assumes that members are fully informed and able to communicate perfectly. However, there is significant empirical and experimental evidence to the contrary. The ability (and willingness) to hide information appears to be critical to influencing how resources are allocated. Anderson and Boland (2002) found that revolving savings and credit associations (ROSCAs), which are ubiquitous in the developing world, were used as a way for women to hide savings from their husbands. Women were less willing to access a bank account with an ATM card when it was easier for their husbands to access the card (Schaner 2017). The researchers found evidence of family pressure and also the capture of grants directed at women (De Mel et al. 2009, Friedson-Ridenour and Peirotti 2019). Similarly, keeping money hidden from spouses (in bank accounts) has been shown to avoid this to some extent (Dupas and Robinson 2013, Fiala 2018). Furthermore, grants in kind (Fafchamps et al. 2014) and mobile money deposits (Riley 2020) are less likely to be allocated.

In turn, the question becomes what factors lead to greater empowerment of women. In general, one can discuss evolutionary and revolutionary factors. For example, technological changes that allow capital to replace what have traditionally been women’s tasks, or allow women greater control over birth rates, could be evolutionary factors. Revolutionary factors may be events such as World War II in the United States workplace that changed opportunities for women, or no-fault divorce movements that changed negotiating positions within marriage. But is it possible to enact specific policies that might provide a boost to greater gender equality? Anderson writes:

One might guess that short-term political interventions are unlikely to change strongly ingrained societal norms, given that many of them have persisted for centuries. However, emerging evidence suggests otherwise. For example, reserving seats for women politicians in rural India has helped reduce negative stereotypes about women as local leaders (Beaman et al. 2009). Television programming has been able to alter fertility preferences in multiple settings (Jensen and Oster 2009, La Ferrara et al. 2012). Borsztein and others. (2020) were able to modify individual Saudi males’ predetermined beliefs regarding the appropriateness of labor supply decisions for their wives by providing information on the average actual male beliefs in their local geographic area. Regular discussions in secondary school classes, conducted between boys and girls in India, have been able to reshape some negative attitudes and behaviors of females (Dar et al., 2022).

or in the political field:

There are a range of policies aimed at increasing women’s political empowerment. There are 135 countries to date that have constitutional, electoral or party quotas for women. Many developing countries outpace developed countries in this respect. The most direct way to ensure female leadership is to reserve political seats for women. Policies that reserve political seats for women, whether at the national or sub-national level, only exist in less developed countries, and such policies are not enforced in Western industrialized nations. … Rwanda leads the world, with women making up 64% of legislators in the national parliament (lower house or single), followed by Senegal (43%), South Africa (41%), Mozambique (39%), Angola (37%), and Tanzania (36%) ) and Uganda (35%). This is in comparison to other developed countries with significantly lower female representation such as Canada (27%) and the United States of America (24%).

Overall, it is clear that there is a relationship between women’s empowerment and higher economic development. As Anderson wrote:[T]There is no simple causal relationship between women’s empowerment and poverty reduction in general. However, there was still a strong positive correlation between gender and measures of overall economic development (GDP/capita or poverty rate). However, the direction of causation probably goes both ways: that is, women’s empowerment affects economic development, while economic development also affects the extent to which women are empowered. Countries develop in different ways, from different starting points. There is no reason to believe that this dual process of women’s empowerment and economic development will proceed the same way across countries. Anderson puts it this way:

In Latin America and the Caribbean, the dramatic rise in female labor force participation rates has been accompanied by a decline in fertility, female education, and the growth of services. The same factors have led to only a moderate increase in women’s participation in the Middle East and North Africa region. It has led to a decline in South Asia (mainly in India). An interesting hypothesis to explain this difference is the role of social stigma. …

There is no reason, then, to expect that cultural changes in the present developing world will mimic the trajectories followed in the West. The heterogeneity in how such norms change within today’s developed world also suggests that local cultures may persist or change in different ways under similar economic pressures. In addition, there are a number of other reasons to suspect that the tracks followed in the West will be foreboding. First, the timing of structural changes varies. Developing countries today have experienced expansion of education and growth in the service sector at much lower levels of per capita GDP than when they took off in the West (Jayachandran 2021). Their legal contexts are also markedly different. Developing countries today have typically inherited the formal legal structures of former colonizers, which tend to be more progressive and women-friendly than the corresponding legal structures that prevailed at similar levels of development in the West. At the same time, in today’s developing countries, these formal legal structures often coexist alongside highly male-biased forms of customary law. Finally, there does not appear to be much of a shock in the job offer of married women, comparable to that of World War II, which could have been a shock to gender norms.

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