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Vicious and virtuous cycles of female labour force participation in post-socialist Eastern Europe

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  • Sonja Avlijas

Abstract

Female labour force participation (hereinafter FLFP) trends across Eastern Europe, which were very high during communism, started to diverge substantially following its collapse. Women did not appear to benefit from the changing labour market conditions in those transition countries that pursued industrial upgrading as their strategy of economic development. On the other hand, in some small transition economies, most notably the Baltic countries, women benefited substantially from increased employment opportunities in the knowledge-intensive public and private sector services. This article seeks to explain the observed variation in FLFP rates across the region by synthesising insights from macroeconomic and comparative political economy literature. It identifies four key relationships between industrial upgrading, educational expansion and the expansion of knowledge-intensive services and examines how these factors interacted and translated into specific FLFP outcomes. The article suggests that industrial upgrading, driven by foreign direct investment, created a vicious cycle for FLFP. First of all, the upgrading led to a defeminisation of manufacturing because female labour-intensive sectors were not upgraded. Furthermore, the upgrading absorbed the budgetary resources that could have been used for educational reform and general skills formation. This lack of educational reform impeded the development of knowledge-intensive services, which would have been more conducive to the generation of female employment. The virtuous cycle of FLFP, on the other hand, occurred in those Eastern European countries that turned to reforming their ed-ucational sector towards general skills and expansion of tertiary education, with the aim of transforming themselves into knowledge economies. Such a transformation required an active social investment oriented state and an expansion of knowledge-intensive public and private sector employment. This development path created a positive causal loop for FLFP. I test these propositions quantitatively on a sample of 13 Eastern European countries.

Suggested Citation

  • Sonja Avlijas, 2016. "Vicious and virtuous cycles of female labour force participation in post-socialist Eastern Europe," LEQS – LSE 'Europe in Question' Discussion Paper Series 119, European Institute, LSE.
  • Handle: RePEc:eiq:eileqs:119
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    File URL: http://www.lse.ac.uk/europeanInstitute/LEQS/LEQSPaper119.pdf
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    References listed on IDEAS

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    1. Hidalgo-Cabrillana, Ana & Castelló-Climent, Amparo, 2010. "Quality and quantity of education in the process of development," UC3M Working papers. Economics we1020, Universidad Carlos III de Madrid. Departamento de Economía.
    2. Gaddis, Isis & Pieters, Janneke, 2012. "Trade Liberalization and Female Labor Force Participation: Evidence from Brazil," IZA Discussion Papers 6809, Institute of Labor Economics (IZA).
    3. Isis Gaddis & Stephan Klasen, 2014. "Economic development, structural change, and women’s labor force participation:," Journal of Population Economics, Springer;European Society for Population Economics, vol. 27(3), pages 639-681, July.
    4. ., 2012. "A brief historical geography of capitalism," Chapters,in: A World in Emergence, chapter 1, pages 1-14 Edward Elgar Publishing.
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    6. repec:asi:ajoerj:2012:p:84-91 is not listed on IDEAS
    7. Jalava, Jukka & Pohjola, Matti, 2002. "Economic growth in the New Economy: evidence from advanced economies," Information Economics and Policy, Elsevier, vol. 14(2), pages 189-210, June.
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    Keywords

    female labour force participation; industrial upgrading; knowledge intensive economy; social investment; capitalist diversity; Eastern Europe;

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