Constraints on the Empowerment of Women
Author: Carol Lorena Perez Romay, ESOP Gender & Economics Scholarship 2011.
The international community has committed itself to the goal of human development and more concretely to the empowerment of women. Empowerment of women is defined as ‘improving their ability to access the constituents of development - in particular health, education, earning opportunities, rights, and political participation’ (Duflo, 2005). In this thesis I concentrate on the empowerment of women in terms of the improvement of their earning opportunities.
My research questions are:
Which constraints limit women’s earning opportunities in developing countries? And can the United Nations and the World Bank’s strategies overcome these constraints?
In order to shed light on the mechanisms that may create conflicts between improved earning opportunities for women and economic growth, I use a structuralist model by Blecker and Seguino (2002). This model permits us to recognise the mobility of firms as the main constraint to realise an optimistic scenario in which the conflict between higher wages and economic growth is overcome. The mobility of firms and the bargaining power it possesses will press workers’ wages down to their reservation wages.
Furthermore, I use a model of monopsonic labour market, in which the firm is able to pay the marginal unit of labour beneath its productivity, to show that the low female wages can be due to other factors than productivity. Monopsony power allows the firm to engage in wage discrimination and pay workers their reservation wages. The pressure on wages is experienced by both women and men, but women are most affected because of their lower reservation wages. I revise the sources to the lower reservation wages of women.
The analysis makes clear that the mobility of capital and asymmetries in the distribution of power between employers and suppliers in the labour market power in developing countries call for international regulation and action rather than country-specific policies. With this in mind, I revise the recommendations made by the United Nations’ Beijing Declaration and the strategic documents from the World Bank and evaluate them in terms of their potential to improve women’s earning opportunities.
I conclude that both the Beijing Declaration and the strategic papers from the World Bank fail to address the constraints that limit women’s earnings opportunities stemming from the mobility of capital across borders and the monopsony power that the firms may possess in the labour markets in developing countries. The organisations miss the global dimensions of such constraints.