Transcript Gender and Trade

Gender and Trade: from inequality
towards equality?
Irene van Staveren
Associate Professor of Feminist Development Economics,
Institute of Social Studies
Labour market flexibilisation:
 Reduction of wage controls and fixed contracts
 Increase in casual labour, part-time labour, subcontracting of production, homework
 Reduction in minimum wages, labour standards,
workers protection
Income insecurity for households
=> increase in female labour supply
 Globalization has lead to feminization of
employment, particularly in export sectors (1970’s1990’s).
FLEXIBILISATION AND
FEMINISATION OF LABOUR IN TRADE
 The asymmetry hypothesis of female employment losses
and trade:
– North-South trade has increased the female
employment share in manufacturing in the South but
not decreased the female employment share in
manufacturing in the North
 Challenging the asymmetry hypothesis: not true when
using more recent data and factor content analysis
– North-South trade does disproportionally affect women’s
manufacturing employment in the North
– Reason: trade affects in particular female intensive sectors
(textiles, leather, apparel)
Gender wage discrimination and trade
 Trade economist Bhagwati: globalisation increases
competition, which in turn reduces labour market
discrimination
But statistics: not true
 Feminist macroeconomist Seguino: GDP growth in
export-oriented developing countries depends on
gender wage inequality
– Evidence from Asia: the higher the gender wage gap the
more exports and the higher GDP growth
– Diagram from: Stephanie Seguino, ‘Gender Inequality and
Economic Growth: a Cross-Country Analysis’ World Development,
28 (7), 2000: 1211-1230); and Feminist Economics, 2000.
Explanation of diagram:
 The gender wage gap stimulates labour
intensive manucfacturing exports in two ways:
– lowering the product price through low female
wage costs
– increasing profits and hence the budget for
purchasing new technology abroad
Gender and Trade: a two-way relationship at 4 levels:

International governance
–
–
–

OECD guidelines for MNCs: make gender more explicit
WTO: gender blind -> connect to women’s organisations that lobby for gender dimension in WTO, such
as IGTN (International Gender and Trade Network)
Bilateral trade agreements: EU has a rule on ensuring gender equality in all policy areas, which includes
trade: refer to this when lobbying EU on social impacts of trade
Multinational firms
–
–
In OECD countries: OECD guidelines
As global buyers in value chains: outsourcing and subcontracting to casual labour through middlemen and
to the informal economy with two opposed effects on gender equality:
•
•
–
–

CSR policy should include informal sector suppliers
HRM policies: affirmative action, equal wage for equal work
Governments in developing countries
–

More employment for women
Low wages for women and unfavourable labour standards
Not excluding Export Processing Zones from labour law (minimum wages, no discrimination) and gender
policy
Households
–
–
–
Home work: risk of child labour involvement due to low piece rates and strong time pressure for
production
Start of an (international) care chain which may affect care for children
Women’s income leading to empowerment?
•
•
YES if backed up by gender equality laws, gender equal social norms, and a strong civil society
NO if not (unequal family law, widespread practices of wife beating, polygamy, non-pooling of income between
husband and wife)
A Gendered Prebisch-Singer
Hypothesis (Shaianne Osterreich):
 Terms of Trade (import prices/export prices) decrease for
developing countries
 P-S Hypothesis: decreasing terms of trade for South are
due to less bargaining power of workers in the South to
claim wage increases with rising productivity
 Empirical study 1975-1995 cross country data:
– Decline of labour market discrimination of women in South
relative to labour market discrimination of women in North
– Associated with improvement of terms of trade for South
Terms of trade will be helped by reducing discrimination
(raising women’s wages and hence the product price)
Gendered Job Vulnerability (Sule Ozler):
 Plant level data 1986-1996 Turkey on job creation
and job destruction under trade
 Job creation was higher in export sector in
particular for unskilled females
 Job destruction was higher for females (see next
slide)
 Gross job reallocation rate was higher for females
Job vulnerability was higher for women than for men
with Turkey’s export-led growth strategy
Table 9.8 Gender differences in job creation and destruction
(1)
(2)
(3)
(4)
(7)
(8)
Un
skilled
female
Un
skilled
male
Skilled
female
Skilled
male
Ratio
(1)/(2)
Ratio
(3)/(4)
Import-competing
59.24
67.04
40.83
59.14
0.88
0.69
Export
67.52
65.88
42.84
56.58
1.02
0.76
Non-competing
60.99
66.60
34.97
53.50
0.92
0.65
Import-competing
85.42
79.68
90.76
82.66
1.07
1.10
Export
83.15
80.15
92.01
82.65
1.04
1.11
Non-competing
83.74
81.69
94.38
83.21
1.03
1.13
A. Job creation
B. Job destruction
Does Import Competition Reduce
Gender Inequality? (Ebru Kongar):




US data 1976-1993 at industry level, comparing concentrated and competitive
manufacturing industries (biggest 4 firms <40% market share).
Measure: gender wage gap that is not justified by differences in education
Finding: reduction of gender wage gap with declining manufacturing employment
Explanation: not expected trade theory mechanism of competition driving down
discrimination but structuralist effects along gender lines:
– Competitive industries: increase of female share of production employment
(cheaper labour) and decline in female wages -> more-cheap-labour strategy
– Concentrated industries: strong reduction of production employment, so that the
remaining female workforce (office jobs) bring up average female wages,
reducing the gender wage gap -> more-skill-intensive-production strategy
Free trade doe not necessarily remove price
discrimination, but can re-enforce segmented quantity
adjustments
Policy options: social clauses, codes
of conduct, decent work (Stephanie Barrientos):
 Social clauses: limitation is that they put the onus
for workers’ rights on exporting country
governments whereas many value chains are
dominated by Northern-based multinationals
 Codes of conduct, however, emphasize
companies’ reputation and ignore women’s
employment conditions in subcontracted informal
sector
 ILO’s Decent work approach is all-encompassing
but its instruments are limited to dialogue and
persuasion, whereas WTO has legal force
Potential macro economic benefits of investment
in gender equality in the labour market:
 If sub-Sahara Africa had the same female/male ratio in education as
East Asia, its GDP per capita growth over the period 1960-1992 would
have been 0.5 percentage points higher (from 0.7% to 1.2%).
 Additionally, the subsequent formal sector employment growth would
have increased GDP per capita with another 0.3%.
So, with less gender inequality in HRD and employment, sub-Sahara
Africa could have had a GDP per capita growth over three decades of
1.5% per annum, which is double the actual growth rate between 1960
and 1992.
(Data from: M. Blackden and C. Bhanu, Gender, Growth, and Poverty Reduction. Washington:
World Bank, 1998. Technical Paper no. 428).
Gender mainstreaming in Fair Trade
initiatives
 Guaranteed minimum prices (for farmers) or wages (in
manufacturing) particularly help female workers because they
are among the lowest paid workers
 Gender-aware labour standards: f.e. regulation and enforcement
of sexual harassment policy, health package including voluntary
family planning information/materials
 Gender-equality in wages, employment, promotion, governance
as an explicit fair trade certification criterion
 Community investment by fair trade buyers in women’s projects
and gender equality projects
 Involvement of small scale producers rather than big
plantations, because this tends to increase the share of women
workers benefitting from fair trade and the extent of
empowerment of women