Advertisement

Journal of Population Economics

, Volume 27, Issue 3, pp 639–681 | Cite as

Economic development, structural change, and women’s labor force participation:

A reexamination of the feminization U hypothesis
  • Isis Gaddis
  • Stephan Klasen
Original Paper

Abstract

A sizable literature claims that female labor force participation (FLFP) follows a U-shaped trend as countries develop due to structural change, education, and fertility dynamics. We show that empirical support for this secular trend is feeble and depends on the data sources used, especially GDP estimates. The U also vanishes under dynamic panel estimations. Moreover, cross-country differences in levels of FLFP related to historical contingencies are more important than the muted U patterns found in some specifications. Given the large error margins in international GDP estimates and the sensitivity of the U relationship, we propose a more direct approach to explore the effect of structural change on FLFP using sector-specific growth rates. The results suggest that structural change affects FLFP consistent with a U pattern, but the effects are small. We conclude that the feminization U hypothesis as an overarching secular trend driving FLFP in the development process has little empirical support.

Keywords

Female labor force participation Economic development Structural change Panel GMM 

JEL Classifications

J16 J21 O15 

Notes

Acknowledgments

We thank R. Emre Aytimur, Friederike Greb, Tim Krieger, Inmaculada Martínez-Zarzoso, Chris Muris, Janneke Pieters, Sebastian Vollmer, two anonymous referees, the editors of this journal, and seminar participants in Göttingen and Cologne for valuable comments and advice. We are grateful to Dani Rodrik and Margaret McMillan for sharing with us the extension of the GGDC 10-Sector database. We also thank Valentina Stoevska of the ILO for sending us an earlier edition of the EAPEP data. Of course, all errors are our own.

Supplementary material

148_2013_488_MOESM1_ESM.docx (127 kb)
(DOCX 126 KB)

References

  1. Ackland R, Dowrick S, Freyens B (2012) Measuring global poverty: why PPP methods matter. Rev Econ Stat. doi: 10.1162/REST_a_00294
  2. Agüero JM, Marks MS (2011) Motherhood and female labor supply in the developing world. J Hum Resour 46(4):800–826. doi: 10.1353/jhr.2011.0002 CrossRefGoogle Scholar
  3. Alesina A, Giuliano P, Nunn N (2011) Fertility and the plough. Am Econ Rev (Papers and Proceedings) 101(3):499–503CrossRefGoogle Scholar
  4. Alesina A, Giuliano P, Nunn N (2013) On the origins of gender roles: women and the plough. Q J Econ. doi: 10.1093/qje/qjt005
  5. Angrist JD, Evans WN (1998) Children and their parents’ labor supply: evidence from exogenous variation in family size. Am Econ Rev 88(3):450–477Google Scholar
  6. Anker R, Anker M (1989) Measuring the female labour force in Egypt. Int Lab Rev 128(4):511–520Google Scholar
  7. Arellano M, Bond S (1991) Some tests of specification for panel data: Monte Carlo evidence and an application to employment equations. Rev Econ Stat 58:277–297CrossRefGoogle Scholar
  8. Arellano M, Bover O (1995) Another look at the instrumental variable estimation of error-components models. J Econ 68:29–51CrossRefGoogle Scholar
  9. Assaad R (2005) Informalization and defeminization. Explaining the unusual pattern in Egypt. In: Kudva N, Benería L (eds) Rethinking informalization: poverty, precarious jobs and social protection. Cornell University Open Access Repository, Ithaca, pp 86–102Google Scholar
  10. Atkinson A, Brandolini A (2001) Promise and pitfalls in the use of ‘secondary’ data-sets: income inequality in OECD countries as a case study. J Econ Lit 39(3):771–799CrossRefGoogle Scholar
  11. Bardhan K, Klasen S (1998) Women in emerging Asia: welfare, employment and human development. Asian Dev Rev 16:72–125Google Scholar
  12. Bardhan K, Klasen S (1999) UNDP’s gender-related indices: a critical review. World Dev 27(6):985–1010CrossRefGoogle Scholar
  13. Benería L (2003) Paid and unpaid labor: meanings and debates. In: Benería L (ed) Gender, development and globalization: economics as if all people mattered. Routledge, London, pp 131–160Google Scholar
  14. Blecker RA, Seguino S (2002) Macroeconomic effects of reducing gender wage inequality in an export-oriented, semi-industrialized economy. Rev Dev Econ 6(1):103–119CrossRefGoogle Scholar
  15. Bloom DE, Canning D, Fink G, Finlay JE (2009) Fertility, female labor force participation, and the demographic dividend. J Econ Growth 14(2):79–101CrossRefGoogle Scholar
  16. Blundell R, Bond S (1998) Initial conditions and moment restrictions in dynamic panel data models. J Econ 87:115–143CrossRefGoogle Scholar
  17. Blundell R, MaCurdy T (1999) Labor supply: a review of alternative approaches. In: Ashenfelter O, Card D (eds) Handbook of labor economics, vol 3, 1st edn. Elsevier, Amsterdam, pp 1559–1695CrossRefGoogle Scholar
  18. Bond S (2002) Dynamic panel data models: a guide to micro data methods and practice. Port Econ J 1:141–162CrossRefGoogle Scholar
  19. Boserup E (1970) Woman’s role in economic development. St. Martin, New YorkGoogle Scholar
  20. Bruno M, Ravallion M, Squire L (1998) Equity and growth in developing countries. Old and new perspectives on the policy issues. In: Tanzi V, Chu K (eds) Income distribution and high-quality growth. MIT press, Cambridge, pp 117–146Google Scholar
  21. Caǧatay N, Özler S (1995) Feminization of the labor force: the effects of long-term development and structural adjustment. World Dev 23(11):1883–1894CrossRefGoogle Scholar
  22. Cavalcanti T, Tavares J (2007) The output cost of gender discrimination: a model-based macroeconomic estimate. Discussion Paper 6477. Centre for Economic Policy Research, LondonGoogle Scholar
  23. Chen S, Datt G, Ravallion M (1994) Is poverty increasing in the developing world. Rev Income Wealth 40(4):359–376CrossRefGoogle Scholar
  24. Christiaensen L, Demery L, Kuhl J (2011) The (evolving) role of agriculture in poverty reduction—an empirical perspective. J Dev Econ 96(2):239–254CrossRefGoogle Scholar
  25. Ciccone A, Jarociński M (2010) Determinants of economic growth: will data tell. Am Econ J Macroecon 2(4):222–246CrossRefGoogle Scholar
  26. Clark RL, York A, Anker R (2003) Cross-national analysis of women in the labour market. In: Garcia B, Anker R, Pinelli A (eds) Women in the labour market in changing economies: demographic issues. Oxford University Press, Oxford, pp 13–34Google Scholar
  27. Cooray A, Gaddis I, Wacker KM (2012) Globalization and female labor force participation in developing countries: an empirical (re-)assessment. CRC-PEG Discussion Paper 129. University of Göttingen, GöttingenGoogle Scholar
  28. Cruces G, Galiani S (2007) Fertility and female labor supply in Latin America: new causal evidence. Lab Econ 14(3):565–573CrossRefGoogle Scholar
  29. Deaton A (2010) Price indexes, inequality, and the measurement of world poverty. Am Econ Rev 100(1):5–34CrossRefGoogle Scholar
  30. Deaton A, Heston A (2010) Understanding PPPs and PPP-based national accounts. Am Econ J Macroecon 2(4):1–35CrossRefGoogle Scholar
  31. Deininger K, Squire L (1998) New ways of looking at old issues: inequality and growth. J Dev Econ 57:259–287CrossRefGoogle Scholar
  32. Durand JD (1975) The labor force in economic development: a comparison of international census data 1946–1966. Princeton University Press, PrincetonGoogle Scholar
  33. Esteve-Volart B (2004) Gender discrimination and growth: theory and evidence from India. DEDPS Discussion Paper 42. London School of Economics and Political Science, LondonGoogle Scholar
  34. Feldmann H (2007) Protestantism, labor force participation, and employment across countries. Am J Econ Sociol 66(4):795–816CrossRefGoogle Scholar
  35. Fernández R (2007) Women, work and culture. J Eur Econ Assoc 5(2–3):305–332CrossRefGoogle Scholar
  36. Fernández R, Fogli A (2009) Culture: an empirical investigation of beliefs, work, and fertility. Am Econ J Macroecon 1(1):146–177CrossRefGoogle Scholar
  37. Fernández R, Fogli A, Olivetti C (2004) Mothers and sons: preference formation and female labor force dynamics. Q J Econ 119(4):1249–1299CrossRefGoogle Scholar
  38. Fortin NM (2005) Gender role attitudes and the labour-market outcomes of women across OECD countries. Oxf Rev Econ Pol 21(3):416–438CrossRefGoogle Scholar
  39. Gaddis I, Pieters J (2012) Trade Liberalization and female labor force participation: evidence from Brazil. IZA Discussion Paper 6809. Institute for the Study of Labor, BonnGoogle Scholar
  40. GGDC (2011) 10-Sector Database. Groningen Growth and Development Centre, University of Groningen, Groningen. http://www.rug.nl/feb/onderzoek/onderzoekscentra/ggdc/data/10sector. Accessed Sept 2011
  41. Ghosh J (2002) Globalization, export-oriented employment for women and social policy: a case study of India. Soc Sci 30(11/12):17–60Google Scholar
  42. Goldin C (1990) Understanding the gender gap: an economic history of American women. Oxford University Press, New YorkGoogle Scholar
  43. Goldin C (1991) The role of World War II in the rise of women’s employment. Am Econ Rev 81(4):741–756Google Scholar
  44. Goldin C (1995) The U-shaped female labor force function in economic development and economic history. In: Schultz TP (ed) Investment in women’s human capital. University of Chicago Press, Chicago, pp 61–90Google Scholar
  45. Grün C, Klasen S (2003) Growth, inequality and well-being: intertemporal and global comparisons. CESifo Econ Stud 49(4):617–659CrossRefGoogle Scholar
  46. Guiso L, Sapienza P, Zingales L (2003) People’s opium? Religion and economic attitudes. J Monetary Econ 50:225–282CrossRefGoogle Scholar
  47. Gustafsson SS (1992) Separate taxation and married women’s labor supply: a comparison of West Germany and Sweden. J Popul Econ 5:61–85CrossRefGoogle Scholar
  48. Gustafsson SS, Wetzels CMMP, Vlasblom JD, Dex S (1996) Women’s labor force transitions in connection with childbirth: a panel data comparison between Germany, Sweden and Great Britain. J Popul Econ 9:223–246CrossRefGoogle Scholar
  49. Gutiérrez M (2003) Macro-economics: making gender matter–concepts policies and institutional change in developing countries. GTZ and Zed Books, LondonGoogle Scholar
  50. Heston A, Summers R, Aten B (2009) Penn world table version 6.3. center for international comparisons of production. Income and prices. University of Pennsylvania, PhiladelphiaGoogle Scholar
  51. Heston A, Summers R, Aten B (2012) Penn world table version 7.1. center for international comparisons of production. Income and prices. University of Pennsylvania, PhiladelphiaGoogle Scholar
  52. Humphries J (1991) Bread and a pennyworth of treacle: excess female mortality in England in the 1840s. Camb J Econ 15(4):451–473Google Scholar
  53. ILO (1996) ILO estimates and projections of the economically active population: 1950–2010, 4th edn., International Labour Organization, GenevaGoogle Scholar
  54. ILO (2009a) ILO estimates and projections of the economically active population: 1980–2020, 5th edn., International Labour Organization, Geneva http://laborsta.ilo.org/. Accessed Jan 2010
  55. ILO (2009b) ILO estimates and projections of the economically active population: 1980–2020, 5th edn., methodological description. International Labour Organization, Geneva. http://laborsta.ilo.org/applv8/data/EAPEP/v6/ILO_EAPEP_methodology_2009.pdf. Accessed Jun 2013
  56. ILO (2011a) ILO estimates and projections of the economically active population: 1990–2020, 6th edn., International Labour Organization, Geneva. http://laborsta.ilo.org/. Accessed Jan 2012
  57. ILO (2011b) ILO estimates and projections of the economically active population: 1990–2020 6th edn., methodological description. International Labour Organization. http://laborsta.ilo.org/applv8/data/EAPEP/v6/ILO_EAPEP_methodology_2011.pdf. Accessed Jan 2012
  58. Jaeger U (2010) Working or stay-at-home mum? the influence of family benefits and religiosity. Ifo Working Paper 84. Ifo Institute for Economic Research at the University of Munich, MunichGoogle Scholar
  59. Jensen R (2012) Do labor market opportunities affect young women’s work and family decisions? Experimental evidence from India. Q J Econ 127(2):753–792CrossRefGoogle Scholar
  60. Johnson S, Larson W, Papageorgiou C, Subramanian A (2013) Is newer better? Penn world table revisions and their impact on growth estimates. J Monetary Econ 60(2):255–274CrossRefGoogle Scholar
  61. Killingsworth MR, Heckman JJ (1986) Female labor supply: a survey. In: Ashenfelter O, Layard R (eds) Handbook of labor economics, Chapter 2, vol 1, 1st edn. Elsevier, Amsterdam, pp 103–204CrossRefGoogle Scholar
  62. Klasen S (1994) Human development and women’s lives in a restructured Eastern Bloc: lessons from the developing world. In: Schipke A, Taylor AM (eds) The economics of transformation: theory and practice in the new market economies. Springer, Berlin, pp 253–294CrossRefGoogle Scholar
  63. Klasen S (2002) Low schooling for girls, slower growth for all? Cross-country evidence on the effect of gender inequality in education on economic development. World Bank Econ Rev 16(3):345–373CrossRefGoogle Scholar
  64. Klasen S (2006) Pro-poor growth and gender inequality. In: Menkhoff L (ed) Pro-poor growth: policy and evidence. Duncker and Humblot, Berlin, pp 151–179Google Scholar
  65. Klasen S, Lamanna F (2009) The impact of gender inequality in education and employment on economic growth: new evidence for a panel of countries. Fem Econ 15(3):91–132CrossRefGoogle Scholar
  66. Klasen S, Pieters J (2012) Push or pull? Drivers of female labor force participation during India’s economic boom. IZA Discussion Paper 6395, Institute for the Study of Labor, BonnGoogle Scholar
  67. Kornai J (1992) The socialist system: the political economy of communism. Princeton University Press, PrincetonCrossRefGoogle Scholar
  68. Kuha J, Temple J (2003) Covariate measurement error in quadratic regression. Int Stat Rev 71(1):131–150Google Scholar
  69. Kuznets S (1955) Economic growth and income inequality. Am Econ Rev 45(1):1–28Google Scholar
  70. Lincove JA (2008) Growth, girls’ education, and female labor: a longitudinal analysis. J Dev Areas 41(2):45–68CrossRefGoogle Scholar
  71. Lind JT, Mehlum H (2010) With or without U? The appropriate test for a U-shaped relationship. Oxf Bull Econ Stat 72(1):109–118CrossRefGoogle Scholar
  72. Lindert PH, Williamson JG (1985) Growth, equality, and history. Explor Econ Hist 22:341–377CrossRefGoogle Scholar
  73. Loayza NV, Raddatz C (2010) The composition of growth matters for poverty alleviation. J Dev Econ 93(1):137–151CrossRefGoogle Scholar
  74. Luci A (2009) Female labour market participation and economic growth. Int J Innovat Sustain Dev 4(2/3):97–108CrossRefGoogle Scholar
  75. Maddison A, Wu HX (2008) Measuring China’s economic performance. World Econ 9(2):13–44Google Scholar
  76. Mammen K, Paxson C (2000) Women’s work and economic development. J Econ Perspect 14(4):141–164CrossRefGoogle Scholar
  77. Marglin SA (1974) What do bosses do? The origins and functions of hierarchy in capitalist production. Rev Rad Pol Ec 6(2):60–112CrossRefGoogle Scholar
  78. McMillan M, Rodrik D (2011) Globalization, structural change and productivity growth. In: Bacchetta M, Jansen M (eds) Making globalization socially sustainable, international labour organization and world trade organization Geneva, pp 49–84Google Scholar
  79. Norris P (2010) Perhaps petroleum perpetuates patriarchy? A response and critique to Ross. Harvard Kennedy School, Cambridge, MA. http://www.hks.harvard.edu/fs/pnorris/Acrobat/Culture,%20Islam%20and%20Oil.pdf. Accessed Feb 2012
  80. OECD (1995) Household production in OECD countries: data sources and measurement methods. Organisation for Economic Co-operation and Development, ParisGoogle Scholar
  81. Pampel FC, Tanaka K (1986) Economic development and female labor force participation: a reconsideration. Soc Forces 64(3):599–619CrossRefGoogle Scholar
  82. Priebe J (2010) Child costs and the causal effect of fertility on female labor supply: an investigation for Indonesia 1993–2008. CRC-PEG Discussion Paper 45, University of Göttingen, GöttingenGoogle Scholar
  83. Psacharopoulos G, Tzannatos Z (1989) Female labor force participation: an international perspective. World Bank Res Obs 4(2):187–201CrossRefGoogle Scholar
  84. PWT (2012) Description of PWT 7.0 and 7.1 July 2012. http://pwt.econ.upenn.edu/Downloads/pwt71/PWT%207.1%20Web.doc. Accessed February 2013
  85. Ramey VA (2009) Time spent in home production in the twentieth-century United States: new estimates from old data. J Econ Hist 69(1):1–47CrossRefGoogle Scholar
  86. Ramey VA, Francis N (2009) A century of work and leisure. Am Econ J Macroecon 1(2):189–224CrossRefGoogle Scholar
  87. Ravallion M (1995) Growth and poverty: evidence for developing countries in the 1980s. Econ Lett 48:411–417CrossRefGoogle Scholar
  88. Ravallion M (2010) Understanding PPPs and PPP-based national accounts: comment. Am Econ J Macroecon 2(4):46–52CrossRefGoogle Scholar
  89. Ravallion M (2012) Price levels and economic growth: making sense of revisions to data on real incomes. Rev Income Wealth forthcoming. doi: 10.1111/j.1475-4991.2012.00510.x
  90. Ravallion M, Datt G (1996) How important to India’s poor is the sectoral composition of economic growth. World Bank Econ Rev 10(1):1–25CrossRefGoogle Scholar
  91. Ravallion M, Chen S, Sangraula P (2009) Dollar a day revisited. World Bank Econ Rev 23(2):163–184CrossRefGoogle Scholar
  92. Ray D (1998) Development economics. Princeton University Press, PrincetonGoogle Scholar
  93. Rees R, Riezman RG (2012) Globalization, gender and growth. Rev Income Wealth 58(1):107–117CrossRefGoogle Scholar
  94. Roodman D (2009) How to do xtabond2: an introduction to difference and system GMM in Stata. Stata J 9(1):86–136Google Scholar
  95. Ross ML (2008) Oil, Islam and women. Am Polit Sci Rev 102(1):107–123CrossRefGoogle Scholar
  96. Seguino S (2000a) Accounting for gender in Asian economic growth. Fem Econ 6(3):27–58CrossRefGoogle Scholar
  97. Seguino S (2000b) Gender inequality and economic growth: a cross-country analysis. World Dev 28(7):1211–1230CrossRefGoogle Scholar
  98. Sinha JN (1967) Dynamics of female participation in economic activity in a developing economy. In: United Nations department of economic and social affairs. Proceedings of the world population conference, Belgrade 1965, vol. IV. UN Publications, New York, pp 336–337Google Scholar
  99. Tam H (2011) U-shaped female labor participation with economic development: some panel data evidence. Econ Lett 110(2):140–142CrossRefGoogle Scholar
  100. Timmer MP, de Vries GJ (2007) A cross-country database for sectoral employment and productivity in Asia and Latin America, 1950–2005. Research Memorandum GD-98, University of Groningen, GroningenGoogle Scholar
  101. UNDP (1995) Human development report. United Nations Development Programme (UNDP), New YorkGoogle Scholar
  102. UNSTATS (2011) National accounts main aggregates database. United Nations Statistics Division, New York, NY. http://unstats.un.org/unsd/snaama/Introduction.asp. Accessed Mar 2012
  103. Waring M (1988) If women counted: a new feminist economics. Harper and Row, San FranciscoGoogle Scholar
  104. Weber M (1905) The Protestant ethic and the spirit of capitalism. English Translation 1930. Unwin Hyman, LondonGoogle Scholar
  105. Windmeijer F (2005) A finite sample correction for the variance of linear efficient two-step GMM estimators. J Econometrics 126: 25–51CrossRefGoogle Scholar
  106. World Bank (2006) World development indicators 2006. World Bank, Washington D.C. http://data.worldbank.org/products/data-books/WDI-2006. Accessed Jun 2013
  107. World Bank (2008a) Comparison of new 2005 PPPs with previous estimates: appendix G (Revised): global purchasing power parities and real expenditures. International Comparison Program and World Bank, Washington DCGoogle Scholar
  108. World Bank (2008b) Global purchasing power parities and real expenditures: 2005 international comparison program. International Comparison Program and World Bank, Washington DCGoogle Scholar
  109. World Bank (2011) World development report 2012: gender equality and development. World Bank, Washington DCCrossRefGoogle Scholar

Copyright information

© Springer-Verlag Berlin Heidelberg 2013

Authors and Affiliations

  1. 1.The World BankDar-es-SalaamTanzania
  2. 2.Institute for the Study of Labor (IZA)BonnGermany
  3. 3.Ifo Institute for Economic ResearchMunichGermany
  4. 4.Department of Economics and Courant Research Centre, Poverty, Equity, and Growth in Developing and Transition CountriesUniversity of GöttingenGöttingenGermany

Personalised recommendations