Trade, Growth and Gender in Developing Countries: A Comparison of Ghana, Honduras, Senegal and Uganda

Developing countries are deeply engaged in trade negotiations at the bilateral, regional and international (WTO) levels. As imports, exports and tariff duties all occupy an important part of their economies, far-reaching impacts on production, labor and capital markets, household incomes and, perhaps most importantly, economic growth will indubitably ensue. As men and women occupy very different roles in these economies, particularly in terms of the import and export orientation of the sectors in which they work, they will be affected very differently by these reforms. To anticipate these changes, a dynamic economy-wide model is used to run trade policy simulations in three African (Ghana, Senegal and Uganda) countries and one Central American (Honduras) country. Whereas most similar existing studies consider the comparative static resource reallocation effects of trade reforms, ours is the first to focus on the growth effects (“dynamic gains from trade”), which are thought to be possibly much larger. In the African countries, trade liberalization is found to increase the gender wage gap in favor of men, expecially among unskilled workers, as men are more active in export-oriented sectors such as cash crops and mining whereas women contribute more to import-competing sectors such as food crops. Furthermore, the ensuing growth effects further widen the gender wage gap, as the productivity gains from increased openness are greatest in female-intensive sectors in which imports rise markedly.