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Can Maquila Booms Reduce Poverty? Evidence from Honduras

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Author Info

  • de Hoyos, Rafael E.

    ()
    (SEMS)

  • Bussolo, Maurizio

    ()
    (The World Bank)

  • Nunez, Oscar

    (The World Bank)

Abstract

This paper identifies and estimates the strength of the reduction in poverty linked to improved opportunities for women in the expanding maquila sector. A simulation exercise shows that, at a given point in time, poverty in Honduras would have been 1.5 percentage points higher had the maquila sector not existed. Of this increase in poverty, 0.35 percentage points is attributable to the wage premium paid to maquila workers, 0.1 percentage points to the wage premium received by women in the maquila sector, and 1 percentage point to employment creation. Given that female maquila workers represent only 1.1 percent of the active population in Honduras, this contribution to poverty reduction is significant.

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Bibliographic Info

Paper provided by The World Bank in its series Policy Research Working Paper Series with number 4789.

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Length: 23 pages
Date of creation: 01 Dec 2008
Date of revision:
Handle: RePEc:wbk:wbrwps:4789

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Keywords: Trade liberalization; maquila; poverty; gender wage gap; Honduras;

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References

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  1. Morley, Samuel & Nakasone, Eduardo & Pineiro, Valeria, 2008. "The impact of CAFTA on employment, production, and poverty in Honduras:," IFPRI discussion papers, International Food Policy Research Institute (IFPRI) 748, International Food Policy Research Institute (IFPRI).
  2. Foster, James & Greer, Joel & Thorbecke, Erik, 1984. "A Class of Decomposable Poverty Measures," Econometrica, Econometric Society, Econometric Society, vol. 52(3), pages 761-66, May.
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Cited by:
  1. Calfat, Germán & Rivas, Ana, 2008. "Fragmentation, income, gender and poverty linkages: The case of the Maquila Industry in Guatemala," IOB Working Papers, Universiteit Antwerpen, Institute of Development Policy and Management (IOB) 2008.02, Universiteit Antwerpen, Institute of Development Policy and Management (IOB).
  2. Denise Stanley, 2010. "Outmigration, Human Development and Trade: A Central American Case Study," Journal of Human Development and Capabilities, Taylor & Francis Journals, Taylor & Francis Journals, vol. 11(2), pages 315-337.
  3. Lopez-Acevedo, Gladys & Robertson, Raymond, 2012. "The Promise and Peril of Post-MFA Apparel Production," World Bank - Economic Premise, The World Bank, The World Bank, issue 84, pages 1-4, May.

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