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Gender Gaps in the Labor Market and Aggregate Productivity

Author

Listed:
  • David Cuberes

    (Department of Economics, The University of Sheffield)

  • Marc Teignier

    (Department of Economics, University of Alicante)

Abstract

The gaps between male and female outcomes and opportunities are present in several different dimensions and many countries, especially in developing ones. These gaps are likely to result in lower aggregate productivity because of an inefficient use of women potential. In this paper we examine the quantitative effects of gender gaps in entrepreneurship and labor force participation on aggregate income. To do the analysis, we first present a simple theoretical framework illustrating the negative impact of gender gaps on resource allocation and aggregate labor productivity. We then calibrate and simulate the model to study the quantitative effects of gender inequality. We show that gender gaps in entrepreneurship have important effects on aggregate productivity and labor force gender gaps on income per capita. Specifically, our model predicts that if all women are excluded from entrepreneurship, average output per worker drops by more than 10% and wages fall by even more, while if all women are excluded from the labor force, income per capita falls by almost 40%. Our cross-country analysis shows that gender gaps and income losses are quite similar across income groups but differ importantly across geographical regions, with a total income loss of 27% in Middle East and North Africa, a 23% loss in South Asia, and a loss of around 15% in the rest of the world.

Suggested Citation

  • David Cuberes & Marc Teignier, 2012. "Gender Gaps in the Labor Market and Aggregate Productivity," Working Papers 2012017, The University of Sheffield, Department of Economics.
  • Handle: RePEc:shf:wpaper:2012017
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    References listed on IDEAS

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    2. Morsy, Hanan, 2020. "Access to finance – Mind the gender gap," The Quarterly Review of Economics and Finance, Elsevier, vol. 78(C), pages 12-21.
    3. International Monetary Fund, 2015. "Hungary; Selected Issues," IMF Staff Country Reports 2015/093, International Monetary Fund.
    4. Stephan E. Maurer & Andrei V. Potlogea, 2014. "Fueling the Gender Gap? Oil and Women's Labor and Marriage Market Outcomes," CEP Discussion Papers dp1280, Centre for Economic Performance, LSE.
    5. Asian Development Bank Institute, 2017. "Aid for Trade in Asia and the Pacific: Thinking Forward About Trade Costs and the Digital Economy," Working Papers id:11882, eSocialSciences.
    6. Romina Kazandjian & Lisa L Kolovich & Kalpana Kochhar & Monique Newiak, 2016. "Gender Equality and Economic Diversification," IMF Working Papers 2016/140, International Monetary Fund.
    7. Chakraborty, Lekha & Ingrams, Marian & Singh, Yadawendra, 2018. "Fiscal Policy Effectiveness and Inequality: Efficacy of Gender Budgeting in Asia Pacific," Working Papers 18/224, National Institute of Public Finance and Policy.
    8. Sonali Das & Sonali Jain-Chandra & Kalpana Kochhar & Naresh Kumar, 2015. "Women Workers in India; Why So Few Among So Many?," IMF Working Papers 2015/055, International Monetary Fund.
    9. Asian Development Bank (ADB) & Asian Development Bank (ADB) & Asian Development Bank (ADB) & Asian Development Bank (ADB), 2015. "Aid for Trade in Asia and the Pacific: Thinking Forward About Trade Costs and the Digital Economy," ADB Reports RPT157499-2, Asian Development Bank (ADB), revised 25 Aug 2015.
    10. Chakraborty, Lekha S & Singh, Yadawendra, 2018. "Fiscal Policy, as the “Employer of Last Resort”: Impact of Direct fiscal transfer (MGNREGA) on Labour Force Participation Rates in India," MPRA Paper 85225, University Library of Munich, Germany.
    11. Mohamed Amara & Wajih Khallouli & Faycel Zidi, 2018. "Gender Discrimination in the Tunisian Labor Market: The Youth Crisis," Working Papers 1263, Economic Research Forum, revised 07 Feb 2018.
    12. International Monetary Fund, 2015. "India; Selected Issues Paper," IMF Staff Country Reports 2015/062, International Monetary Fund.
    13. Katrin Elborgh-Woytek & Monique Newiak & Kalpana Kochhar & Stefania Fabrizio & Kangni R Kpodar & Philippe Wingender & Benedict J. Clements & Gerd Schwartz, 2013. "Women, Work, and the Economy; Macroeconomic Gains from Gender Equity," IMF Staff Discussion Notes 13/10, International Monetary Fund.

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    More about this item

    Keywords

    gender inequality; entrepreneurial talent; factor allocation; aggregate productivity;
    All these keywords.

    JEL classification:

    • E2 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General

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