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Globalisation, Gender, and Equity: Effects of Foreign Direct Investment on Labour Markets in Rural Indonesia

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  • Siegmann, Karin Astrid

Abstract

This study assesses the impact of foreign direct investment (FDI) on gendered labour markets in rural Indonesia. It focuses on the gender composition of the workforce, female and male workers? employment conditions and gender wage inequality. Th e research strategy of ?between-methods triangulation? is chosen, denoting the combination of quantitative and qualitative types of data generation and analysis. Two underlying mechanisms have been identified. A ?cost eff ect? associated with transnational corporations? (TNCs?) greater orientation towards the world market is the preferential recruitment of, on average, lower paid female workers. In light of global competitive cost considerations, this appears as a rational strategy for TNCs. Conversely, foreign fi rms? advanced technological endowments relative to domestic companies require a well-educated workforce with technical skills. In light of these perspectives, gender gaps in education and, on average, women?s weaker labour market attachment disadvantage female workers? employment in TNCs. Both eff ects are mediated by a ?reproductive constraint?. Th is refers to the asymmetric distribution of reproductive obligations between female and male household members, whereby female input into the domestic economy is more demanding relative to that of males.

Suggested Citation

  • Siegmann, Karin Astrid, 2007. "Globalisation, Gender, and Equity: Effects of Foreign Direct Investment on Labour Markets in Rural Indonesia," Proceedings of the German Development Economics Conference, Göttingen 2007 30, Verein für Socialpolitik, Research Committee Development Economics.
  • Handle: RePEc:zbw:gdec07:6553
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    File URL: https://www.econstor.eu/bitstream/10419/19883/1/Siegmann.pdf
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    More about this item

    Keywords

    gender; globalisation; foreign direct investment; labour markets; Indonesia; economic methodology;

    JEL classification:

    • F02 - International Economics - - General - - - International Economic Order and Integration
    • J81 - Labor and Demographic Economics - - Labor Standards - - - Working Conditions
    • B41 - Schools of Economic Thought and Methodology - - Economic Methodology - - - Economic Methodology
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination
    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements

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