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Effects of Trade on Female Labor Force Participation

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  • Hosny Zoabi
  • Philip Saure

Abstract

This paper uncovers a counter-intuitive effect of international trade on female labor shares: whenever trade expands, sectors intensive in female labor, female labor shares drop and vice versa. According to our key assumption a rising capital labor ratio closes the gender wage gap. The paper’s mechanism operates as follows. Expansions of sectors intensive in female labor come along with contractions of sectors intensive in male labor. These contractions imply that male labor reallocates to sectors intensive in female labor. The capital labor ratio in the latter sectors drops, which widens the gender wage gap and causes a decrease in aggregate female labor shares. Based on instrumented U.S.-Mexican trade flows, we provide empirical evidence in support of our theory.

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Bibliographic Info

Paper provided by DEGIT, Dynamics, Economic Growth, and International Trade in its series DEGIT Conference Papers with number c015_015.

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Length: 55 pages
Date of creation: Sep 2010
Date of revision:
Handle: RePEc:deg:conpap:c015_015

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Keywords: Trade; Female Labor Force Participation; Fertility; Technological Change;

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  1. Doepke, Matthias & Hazan, Moshe & Maoz, Yishay D, 2008. "The Baby Boom and World War II: A Macroeconomic Analysis," CEPR Discussion Papers 6628, C.E.P.R. Discussion Papers.
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Citations

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Cited by:
  1. Gaddis, Isis & Pieters, Janneke, 2012. "Trade Liberalization and Female Labor Force Participation: Evidence from Brazil," IZA Discussion Papers 6809, Institute for the Study of Labor (IZA).
  2. Gladys Lopez-Acevedo & Raymond Robertson, 2012. "The Promise and Peril of Post-MFA Apparel Production," World Bank Other Operational Studies 10043, The World Bank.
  3. Silvio Contessi & Francesca de Nicola & Li Li, 2012. "International trade, female labor, and entrepreneurship in MENA countries," Working Papers 2012-053, Federal Reserve Bank of St. Louis.
  4. Ural Marchand, Beyza & Rees, Ray & Riezman, Raymond, 2011. "The Effect of Parental Labor Supply on Child Schooling: Evidence from Trade Liberalization in India," Working Papers 2011-21, University of Alberta, Department of Economics, revised 01 Mar 2012.
  5. Fischer, Justina A.V., 2014. "Globalized markets, globalized information, and female employment: accounting for regional differences in 30 OECD countries," MPRA Paper 55142, University Library of Munich, Germany.
  6. Lopez-Acevedo, Gladys & Robertson, Raymond, 2012. "The Promise and Peril of Post-MFA Apparel Production," World Bank - Economic Premise, The World Bank, issue 84, pages 1-4, May.
  7. Beyza Ural Marchand & Ray Rees & Raymond Riezman, 2011. "Globalization, Gender and Development: The Effect of Parental Labor Supply on Child Schooling," CESifo Working Paper Series 3341, CESifo Group Munich.

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