Summary

Bansari Nag

The issue of gender inequality has gathered momentum in the light of the mandates given by the United Nations, including the Beijing Platform for Action and as part of the Millennium Development Goals (MDGs).

The paper being discussed aims to explore the impact of trade liberalization and its impact on gender inequalities in Pakistan.  Gender inequality is assessed on the basis of the existing inequalities in the labour market, education and health facilities. The paper points out that gender is the basis for division of labour between productive (income generating) and reproductive (unpaid domestic work). The main focus of this paper is to analyse the impact of trade liberalization on gender inequalities. Indicating that trade liberalization will change the relative prices of goods, tariff revenues for the government as well as the real income of different groups depending on their consumption patterns. In most of the developing economies, women are deprived of the basic services and remain vulnerable.

In order to analyze the impact on gender inequality it is important to identify its determinants such as income, imports, exports and educational facilities. A rise in per capita income can be a major factor in reducing the extent of gender inequality for a variety of reasons. Internationally, there is a strong correlation between the level of per capita income and the equalization of economic opportunity between men and women. High income industrialized countries have less gender disparities. Changes in relative prices of goods can cause reallocation of factors of production and reduction in tariff revenues can cause a change in public expenditures. Job opportunities with changes in the prices of goods bring a change in the purchasing power of the households and alter the allocation of resources within the household.

A theoretical discussion in this line could reflect to the Heckscher-Ohlin-Samuelson theorems explaining the distributive impact of the movement of labour across countries. Trade liberalization increases the competition of unskilled workers among developing and developed countries which leads to improved wages for unskilled workers in developing countries and consequently reduces the wage gap. Women comprise a larger segment of unskilled workforce and hence a fall in the wage gap between skilled and unskilled labour positively impacts gender wage gap. In this line, Gary Becker’s theory also indicates that trade liberalization increases competition thereby thwart the ability of firms to be able to maintain the costly discrimination, which leads to a reduction in gender wage gap. Testing Becker’s theory it was found that increased competition through trade openness led to improvement in female wages more in concentrated industries than the competitive ones.

United Nations Development Program (UNDP, 1995) introduced a Gender Development Index (GDI) which was constructed to evaluate cross-country differences in gender inequality. This gender sensitive index uses the same three sectors as those used in the Human Development Index (HDI), i.e., income, education and health. In this paper other labour market indicators are used to evaluate the effects of trade liberalization on gender inequality thus measured.

Using the individual indices three sectoral indices are constructed. These are the Educational Attainment Index, Survival Index and Labour Participation Index. Access to better education is the fundamental prerequisite towards gender equality and in this study gender disparities in educational attainment are captured using data on literacy rates, enrolment rates for primary and secondary education and number of employed teachers in Pakistan. The number of employed females versus male teachers matter in Pakistan because in large sections of the country, especially in backward rural areas, only female teachers are allowed to be employed in girl schools.

Another important criterion is the access to better health services.  For the study indicators such as life expectancy, crude death rate and child mortality is used to indicate gender differences. More women in the workforce is an indication of lowering the disproportionate level of poverty among women.

Results drawn on the basis of the above index demonstrate a decline in the overall gender inequality in Pakistan. While the female labour force participation rate has more than doubled during the past 31 years, from 7¼ percent in 1972-73 to nearly 16 percent in 2004-05, it is still very low compared to male participation, which was at almost 69 percent in 2005. Educational attainment index has also improved from 148.8 to 112.3 over the sample period from 1973-2005. However, the low level of female enrollment relative to male enrollment impedes the entry of women in the economic labour force and leads to a concentration of females in the unskilled labour force. The survival index doesn’t show any significant inequality between men and women, or much movement in the relative positions of men and women over time.

Study results indicate that gender inequality appears to be declining sharply during the 1970s, with an improvement in female enrollment rates and a drop in male labour force participation rate. The first half of the 1980s shows an increase in gender inequality that is mainly attributed to a decline in the labour force participation rate for both males and females, in an era of high unemployment in the country. Later, during the 1990s, the high enrollment rates helped resume the decline in gender inequality index.

Trade liberalization had a significant impact in reducing gender inequality in Pakistan.  Gender inequality is more sensitive to exports than imports and export expansion would increase income - generating opportunities for women especially in the textile sector leading to higher wages within the household thus empowering women. Again with increasing completion it is difficult for employers to sustain costly discrimination against women having a preference for male workers at high salary.

Again, females are the first to be affected by any reduction in household income and therefore higher per capita income helps reduce intra-household gender inequality. Further, investment in human capital of females is not a priority in households in developing countries such as Pakistan. Role of public policy with the objective of providing equal opportunities for women in education and other basic services would go a long way towards reducing gender inequality. During the 2001-05 period, increase in share of export in GDP in Pakistan has contributed significantly towards reducing gender inequality in labour market. It has been observed that growth in per capita income has enabled more households to provide education to females.

The argument that gender inequality is reduced with the increase in the level development as brought about by trade integration and openness seems to be valid in case of the less developed country like Pakistan. Empirical analysis has shown that variables related to trade liberalization, income and public policy has played an important role in explaining the changes of gender inequality .