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The Effects of Real Exchange Rate Fluctuations on the Gender Wage Gap and Domestic Violence in Uruguay

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  • Munyo, Ignacio
  • Rossi, Martín

Abstract

In this paper, we bring to light the experiences resulting from the significant depreciation of the Uruguayan real exchange rate between 2002 and 2003, followed by an equally considerable appreciation between 2004 and 2010. We explore the link between these fluctuations and the incidence of domestic violence taking place in Uruguay. The real exchange rate is a measure of the relative price between tradable and nontradable goods. While men are traditionally employed in tradable industries, such as manufacturing, women are more likely to work in nontradable industries, such as the service sector. A change in the real exchange rate, therefore, can affect the potential wages of men differently from those of women. In line with the models that represent household bargaining, an increase in the real exchange rate can generate an increase in the bargaining power of men relative to that of women within the household. We present evidence that it raises the frequency of domestic violence. This holds true in rich and poor areas of the city.

Suggested Citation

  • Munyo, Ignacio & Rossi, Martín, 2015. "The Effects of Real Exchange Rate Fluctuations on the Gender Wage Gap and Domestic Violence in Uruguay," IDB Publications (Working Papers) 7211, Inter-American Development Bank.
    • Handle: RePEc:idb:brikps:7211
    DOI: https://doi.org/10.18235/0000143
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    References listed on IDEAS

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    3. Robert A. Pollak, 2005. "Bargaining Power in Marriage: Earnings, Wage Rates and Household Production," NBER Working Papers 11239, National Bureau of Economic Research, Inc.
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    Cited by:

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    2. Veeramani, Choorikkad & Banerjee, Purna, 2022. "Exchange rate fluctuations, labour laws, and gender differences in job flows: Analysis of manufacturing industries across Indian states," World Development, Elsevier, vol. 152(C).
    3. Grogan, Louise, 2025. "Employment without empowerment: Low-wage manufacturing and intimate partner violence in Nicaragua, 1998–2012," World Development, Elsevier, vol. 195(C).
    4. M. Amelia Gibbons & Tommy E. Murphy & Martín A. Rossi, 2021. "Confinement and intimate partner violence," Kyklos, Wiley Blackwell, vol. 74(3), pages 349-361, August.
    5. Erten, Bilge & Metzger, Martina, 2019. "The real exchange rate, structural change, and female labor force participation," World Development, Elsevier, vol. 117(C), pages 296-312.
    6. Santiago M. Perez-Vincent & Enrique Carreras, 2022. "Domestic violence reporting during the COVID-19 pandemic: evidence from Latin America," Review of Economics of the Household, Springer, vol. 20(3), pages 799-830, September.
    7. Stephanie Seguino, 2017. "Engendering Macroeconomic Theory and Policy," World Bank Publications - Reports 28951, The World Bank Group.
    8. Cecilia Alonso, 2018. "Transferencias Monetarias y Crimen. Evidencia para la última década en Montevideo," Documentos de Investigación Estudiantil (students working papers) 18-02, Instituto de Economía - IECON.

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    JEL classification:

    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law

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