fbpx
01 / 04
How Economic Freedom Has Benefited Women

Blog Post | Gender Equality

How Economic Freedom Has Benefited Women

Women's empowerment in many developing countries is in its early phases.

A economically free woman working

Economic freedom and resulting competitive markets empower women in at least two interrelated ways.

First, market-led innovation has improved the lives of women even more so than for men. For example, women have reaped greater benefits from health advances financed by the prosperity created by free enterprise: female life expectancy has risen faster than men’s and today women outlive men almost everywhere. Women are also less likely to die in childbirth.

Labor-saving household devices have also freed women from the burden of housework. Thanks to time-saving kitchen appliances, in the United States cooking has gone from consuming the same hours as a full-time job, to taking up only around an hour a day. And thanks to laundry machines, in rich countries washing has gone from taking up a full day each week to less than two hours a week on average. This freeing of women’s time is ongoing as appliances spread throughout the world. Market competition and the profit motive incentivized the invention of labor-saving household devices and continue to motivate their ongoing marketing to new customers in developing countries. Countries that liberalize their economies often see rapid economic progress, including more households able to afford modern conveniences. China’s economy has grown dramatically since it adopted policies of greater economic freedom in 1978. In 1981, less than 10 percent of urban Chinese households had a washing machine. By 2011, over 97 percent did. As women spend less time on household chores, more choose to engage in paid labor.

Second, labor market participation offers women economic independence and heightened societal bargaining power. Factory work, despite its poor reputation, empowered women in the 19th century United States by helping them achieve economic independence and social change. It also softened attitudes about women engaging in paid labor. Today, the same process is repeating in the developing countries.

Consider China and Bangladesh. In China, factory work gave rural women a chance to escape the dire poverty and restrictive gender roles of their home villages and has dramatically slashed the suicide rate among young rural-born Chinese women, once among the highest in the world. Social mobility is high and most economic migrants never return permanently to the countryside: they settle in their adopted cities or eventually move to towns near their home villages and set up stores, restaurants or small businesses like hairdressing salons or tailoring shops. Many become white-collar workers. Very few go back to farming. Similarly, in Bangladesh factory work let women renegotiate restrictive cultural norms. The country’s women-dominated garment industry transformed the norm of purdah, or seclusion, that traditionally prevented women from working beyond the home, walking outside unaccompanied by a male guardian, or even speaking in the presence of unrelated men. Today, in Dhaka and other industrial cities, women walk outside and interact with unrelated men. Research by social economist Naila Kabeer of the London School of Economics found that “the decision to take up factory work was largely initiated by the women themselves, often in the face of considerable resistance from other family members.” Tragedies like the Rana Plaza building collapse garner a lot of press, but the garment industry’s wider-reaching effects on the material wellbeing and social equality of women in Bangladesh receive less attention. The same applies to other industrializing countries.

By freeing women’s time from household drudgery and offering women the economic bargaining power that comes with new employment opportunities, markets heighten women’s material standard of living and foster cultural change. Women’s empowerment in many developing countries is in its early phases, but the right policies can set women everywhere on a path toward the same prosperity and freedom enjoyed by women in today’s wealthy countries.

This first appeared in Apple News and in Quora.

Blog Post | Personal Income

What the Data Say About Equal Pay Day

We should take a clear-eyed view of the data and recognize the remarkable gains women have made in the workplace.

This week saw the passing of “Equal Pay Day,” which marks the culmination of the roughly three extra months that an average female employee had to work in 2019 to match the amount of money made by an average male worker in 2018. Many people see the pay gap as unjust, but is it really a result of rampant sexism in the workplace as the critics allege?

A survey unveiled on Tuesday by CNBC and Survey Monkey suggests that, actually, both men and women are equally pleased with their employment situations and the earnings gap can largely be explained by women being more likely on average to choose part-time work.

“Men have a Workplace Happiness Index score of 72 and women a score of 70, close enough to lack a statistically meaningful difference,” according to the newly released data. That fits with earlier polling that was conducted by Cato’s Dr. Emily Ekins, which found that in the United States, the vast majority of women “believe their own employers treat men and women equally.” Fully 86 percent of women polled believed that their employer pays women equally.

There is still a pay gap between men and women who work full-time, but that may be partly due to men and women opting to work in different fields. Dangerous jobs in fields like mining and fishing, for example, tend to attract men. Those jobs also tend to be relatively well-remunerated. (As HumanProgress.org advisory board member Mark Perry points out, the gender gap in workplace deaths far exceeds the gap in pay).

Even so, among full-time workers, the “pay gap” is rapidly narrowing. Data from the OECD shows that the gender wage gap in median earnings of full-time employees is declining in practically all countries for which there are data. In the United States, highlighted in blue in the graph below, the wage gap has fallen dramatically since the 1970s. In 1975, the U.S. gender wage gap was 38 percent. By 2015, it had shrunk to 18 percent.

That 18 percentage point difference does not take into account important characteristics like “age, education, years of experience, job title, employer, and location,” according to my Cato colleague Vanessa Calder. A recent study, which controlled for those characteristics, concluded that the U.S. gender pay gap is only around five percent, meaning that Equal Pay Day should actually be in January.

Of course, if any of that small remaining five percent gap is the result of sexist discrimination—rather than additional mitigating factors that the study failed to control for—then that is unacceptable. We should denounce all forms of inequitable treatment, wherever it persists. We should also take a clear-eyed view of the data and recognize the remarkable gains women have made in the workplace—and how labor market participation has transformed women’s lives for the better.

Blog Post | Science & Technology

Follett: How Markets Empower Women

Innovation and Market Participation Transform Women's Lives for the Better

An image of silhouetted women holding briefcases.

Over the last 200 years, economic progress has helped to bring about both dramatically better standards of living and the extension of individual dignity to women in the developed world. Today the same story of market-driven empowerment is repeating itself in developing countries.

Competitive markets empower women in at least two interrelated ways. First, market-driven technological and scientific innovations disproportionately benefit women. Timesaving household devices, for example, help women in particular because they typically perform the majority of housework. Healthcare advances reduce maternal and infant mortality rates, allowing for smaller family sizes and expansion of women’s life options. Second, labor market participation offers women economic independence and increased bargaining power in society. Factory work, despite its poor reputation, has proven particularly important in that regard.

In these ways, markets heighten women’s material standard of living and foster cultural change. Markets promote individual empowerment, reducing sexism and other forms of collective prejudice.

Women’s empowerment in many developing countries is in its early phases, but the right policies can set women everywhere on a path toward the same prosperity and freedom enjoyed by women in today’s advanced countries.

Read the whole paper here.

Blog Post | Gender Equality

Five Graphs Celebrating Women's Progress

These graphs show the incredible progress women have made in the realms of work, education, health...

Harriet Tubman’s forthcoming placement on the U.S. twenty dollar bill is being hailed as a symbolic win for women. Tubman certainly deserves the honor, and Cato’s Doug Bandow called for putting Tubman on “the twenty” a year ago. In celebration of the soon-to-be-redesigned twenty dollar bill, here are 5 graphs showcasing the incredible progress that women have made in the realms of work, education, health, etc.

1. The gender wage gap, which is largely the result of divergent career choices between men and womenrather than overt sexism, is narrowing in the United States and in other developed countries. Part of this trend may be explained by more women entering highly paid fields previously dominated by men. For example, there are more women inventors and researchers in developed countries.

label 

2. Around the world, girls in their teens have fewer children and are more likely to complete secondary education. As a smaller share of teenaged girls become mothers, many are better able to pursue education. The gender gap in youth literacyprimary school completion, and secondary school completion are all shrinking, even in many poor areas. Today, there are actually more women than men pursuing tertiary education and earning college degrees.

label 

3. In the United States, domestic violence against women has fallen considerably since the 1990s. And the very worst kind of domestic violence—homicide of an intimate partner—has also become rarer in the United States, both for male and female victims. Police also recorded fourteen thousand fewer cases of rape in the United States in 2013 than in 2003—in spite of a population increase. In fact, both rapes and sexual assaults against women have declined significantly in the United States since the 1990s. Evolving attitudes about the acceptability of violence against women may be partially to thank.

label 

4. Dramatically fewer women die in childbirth, once a common cause of death for women. Around the world, more pregnant women receive prenatal care and more births are attended by skilled health staff. Like their mothers, newborn babies are also less likely to die, as are infants and children generally. Between 1990 and 2015, a girl’s likelihood of dying before her fifth birthday fell by about 54% globally.

label 

5. More and more women hold seats in the world’s parliaments, or hold ministerial level positions. There are also more women legislators, managers, and senior officials. There is some evidence that women are more likely to rise to achieve high positions in the private sector in countries with freer markets.

label 

This first appeared in CapX.