Research Roundup on Gender in Development (October 2012)
Joint liability in Grameen Bank works for men and women for different reasons
Competing theories support the positive role of social capital in small loan default costs of group lending. At the same time, potential group collusion may increase loan delinquencies. Previous findings are mixed on the role of the various attributes of group lending and suffer from estimation bias due to the unobserved sorting behavior of group members and their other attributes. To address this estimation bias longitudinal data from 297 Grameen Bank groups since their inception is used to estimate the effect of group liability. The results suggest that group liability matters in both loan disbursement and repayment, with women less of a credit risk than men and women’s groups more homogeneous than men’s. Finally, the benefits of social capital outweigh the costs of group collusion, especially for women’s groups, thereby reducing overall default rates. The risk-pooling behavior of diverse men’s groups increases men’s repayment behavior. Overall, group lending as practiced by Grameen Bank appears to increase repayment rates.
Khandker, Shahid R. 2012. “Grameen Bank Lending: Does Group Liability Matter?” World Bank Policy Research Working Paper 6204, September.
Minimum wage increases hurt less-educated non-production workers in small Indonesian firms
Increasing the minimum wage is often touted as the best way to boost the earnings of low-income workers. However, if low-income workers are already fully compensated at the prevailing wage for their contribution to firm production, they may lose their jobs with the introduction of a (higher) minimum wage. This is most likely to apply in the case of unskilled workers. Survey data from Indonesian manufacturing firms from 1993 to 2006 reveals that individual firms reduced employment in response to increases in the minimum wage. The reduction in employment was large and significant for small firms and less-educated workers, but not for large firms and workers with at least a high school education. Non-production workers with low levels of education saw the largest declines in employment, and most of the non-production job losses are experienced by female workers.
Del Carpio, Ximena, Ha Nguyen, and Liang Choon Wang. 2012. “Does the Minimum Wage Affect Employment? Evidence from the Manufacturing Sector in Indonesia.” World Bank Policy Research Working Paper 6147, July.
Business training for Sri Lankan women speeds up new entry, but has little impact on existing firms
The Start-and-Improve Your Business program is the most commonly used business training program worldwide. The impact of this training is assessed for two groups of Sri Lankan women—women operating subsistence enterprises and a random sample of women who are out of the labor force but interested in starting a business. Training by itself or coupled with a cash grant is found to have different short- and medium-term impacts. For women already in business, training alone leads to some changes in business practices but has no impact on business profits, sales or capital stock. In contrast, the combination of training and a grant leads to large and significant improvements in business profitability in the first eight months, but this impact dissipates in the second year. For women interested in starting enterprises, business training speeds up entry but leads to no increase in net business ownership by the final survey round. Both profitability and business practices of the new entrants are increased by training, suggesting training may be more effective for new owners than for existing businesses.
de Mel, Suresh, David McKenzie, and Christopher Woodruff. 2012. “Business Training and Female Enterprise Start-up, Growth, and Dynamics: Experimental Evidence from Sri Lanka.” World Bank Policy Research Working Paper 6145, July.
Wage subsidies are not a long-term fix for persistent unemployment of young urban women in Jordan
Throughout the Middle East, unemployment rates of educated youth have been persistently high and female labor force participation, low. A randomized experiment in Jordan designed to assist female community college graduates find employment assigned graduates to four groups: one group received a voucher equal to the minimum wage for up to 6 months, another group had the opportunity to attend 45 hours of employability skills training, a third group was offered both interventions, and the fourth group formed the control. The job voucher led to a 40 percent increase in employment in the short run. Most of this employment was informal, and the average effect is much smaller and no longer statistically significant 4 months after the voucher period ended. The voucher does appear to have persistent impacts outside the capital, where it almost doubles the employment rate of graduates, but this appears likely to reflect displacement effects. Soft-skills training has no average impact on employment, although there is a weakly significant impact outside the capital. The results suggest that while wage subsidies may help increase employment in the short term, they are not a solution for the problems of high urban female youth unemployment.
Groh, Matthew, Nandini Krishnan, David McKenzie, and Tara Vishwanath. 2012. “Soft Skills or Hard Cash? The Impact of Training and Wage Subsidy Programs on Female Youth Employment in Jordan.” World Bank Policy Research Working Paper 6141, July.
Married women with low bargaining power can face increased risk of domestic violence upon entering the labor force
While there are many positive societal implications of increased female labor force opportunities, some theoretical models and empirical evidence suggest that working can increase a woman’s risk of suffering domestic violence. Using a dataset collected in peri-urban Dhaka, this analysis documents a positive correlation between work and domestic violence. This correlation is only present among women with less education or who were younger at first marriage. These results are consistent with a theoretical model in which a woman with low bargaining power can face increased risk of domestic violence upon entering the labor force as a husband seeks to counteract her increased bargaining power, while a woman with higher baseline bargaining power is protected from domestic violence because she can leave a violent marriage.
Heath, Rachel. 2012. “Women’s Access to Labor Market Opportunities, Control of Household Resources, and Domestic Violence.” World Bank Policy Research Working Paper 6149, July.
Social pressure to share income with kin may discourage entrepreneurship in rural Africa
Individuals living in poor, rural communities often feel obligated to share income with relatives and neighbors. This obligation can discourage entrepreneurs from undertaking profitable business ventures that are easily observable. Unfortunately, it has been difficult or impossible to observe the magnitude of this effect because surveys cannot capture the returns to activities that were not actually undertaken. A newly designed lab experiment makes it possible to measure the economic impact of social pressure to share income with kin and neighbors. The goal was to test whether subjects in rural Kenyan villages reduce their income in order to keep it hidden. Results indicate that women adopt an investment strategy that conceals the size of their initial endowment in the experiment, although that strategy reduces their expected earnings. The effect is largest among women with relatives present. This suggests that women behave as though they expect to be pressured to share 4 percent of their observable income with others, and substantially more when close kin can observe income directly. Simulations suggest that a “kin tax” of this magnitude may significantly reduce the probability that women open new microenterprises.
Jakiela, Pamela, and Owen Ozier. 2012. “Does Africa Need a Rotten Kin Theorem? Experimental Evidence from Village Economies.” World Bank Policy Research Working Paper 6085, June.
Intergenerational income transfers in China
Educated and married children have a higher tendency to provide transfers to their parents; and oldest sons are less likely to provide transfers than their younger brothers. Upward generational transfers will likely remain the most common form of private transfers in the absence of some other source of elderly support (such as a public pension or own savings). But dwindling number of children implies that the financial burden associated with supporting the elderly is likely to increase.
Lei, Xiaoyan, John Giles, Yuqing Hu, Albert Park, John Strauss, and Yaohui Zhao. 2012. “Patterns and Correlates of Intergenerational Non-Time Transfers: Evidence from CHARLS.” World Bank Policy Research Working Paper 6076, June.
Gender and rural non-farm entrepreneurship
In Bangladesh, Indonesia, and Sri Lanka women are less likely than men to become non-farm entrepreneurs, whereas in Ethiopia they are as likely as men to be running non-farm firms. Women's non-farm entrepreneurship isn't strongly correlated with household composition or educational attainment, but is prevalent among women who are the head of their household. Female-led firms are smaller and less productive on average, although gender differences in productivity vary dramatically across countries. Male firms are roughly 10 times as productive as female firms in Bangladesh, three times as those in Ethiopia, and twice as those in Sri Lanka. Indonesia showed no differences in labor productivity.
Rijkers, Bob, and Rita Costa. 2012. “Gender and Rural Non-Farm Entrepreneurship.” World Bank Policy Research Working Paper 6066, May.
Cash transfer program reduced HIV and HSV-2 infections in young women in Malawi
A randomized control trial tested the efficacy of conditional (on school attendance) and unconditional cash transfer programs to reduce the risk of sexually transmitted infections in young women. No effects were detected on either HIV or HSV-2 among women who had already dropped out of school by the baseline. These effects are supported by changes in self-reported sexual behavior; no effects on age of sexual debut or unprotected sex were detected, but individuals in the intervention group chose younger partners than those in the control group and their sexual activity with those partners was less frequent. The findings suggest that financially empowering school-age girls and their families can have substantial effects on their sexual and reproductive health.
Baird, Sarah J., Richard S. Garfein, Craig T. McIntosh, and Berk Özler. 2012. “Effect of a cash transfer programme for schooling on prevalence of HIV and herpes simplex type 2 in Malawi: A cluster randomised trial.” The Lancet 379(Issue 9823): 1320-29.
Female entrepreneurship is low in many developing economies
The same brochure with two different cover pictures (a male or female as the business owner) was randomly distributed among male and female clients as part of a marketing experiment to increase women’s access to credit. The results suggest that women's response to the brochure was affected by the level of autonomy at home, suggesting that more intensive interventions may be required for more disadvantaged women.
Giné, Xavier, Ghazala Mansuri, and Mario Picón. 2012. “Does a Picture Paint a Thousand Words? Evidence from a Microcredit Marketing Experiment.” World Bank Policy Research Working Paper 6020, April.
India’s Employment Guarantee Scheme does not guarantee employment
In 2005 India introduced an ambitious national anti-poverty program, now called the Mahatma Gandhi National Rural Employment Guarantee Scheme. The program offers up to 100 days of unskilled manual labor per year on public works projects for any rural household member who wants such work at the stipulated minimum wage rate. The aim is to dramatically reduce poverty by providing extra earnings for poor families, as well as empowerment and insurance. If the program worked in practice the way it is designed, then anyone who wanted work on the scheme would get it. However, analysis of data from India’s National Sample Survey for 2009/10 reveals considerable unmet demand for work in all states. Expectations that poorer families tend to have more demand for work is confirmed, and that (despite the unmet demand) the self-targeting mechanism allows it to reach relatively poor families and backward castes. The extent of the unmet demand is greater in the poorest states—ironically where the scheme is needed most. Labor-market responses to the scheme are likely to be weak. The scheme is attracting poor women into the workforce, although the local-level rationing processes favor men.
Dutta, Puja, Rinku Murgai, Martin Ravallion, and Dominique van de Walle. 2012. “Does India’s Employment Guarantee Scheme Guarantee Employment?” World Bank Policy Research Working Paper 6003, March.
Understanding behaviors around HIV in Africa
In Africa, uncertainty in the lives of those at risk for HIV may affect how intentions are formed. Characterizing this uncertainty by understanding the reasons for discrepancies between intentions and actions may help improve the design of HIV-prevention interventions. The findings suggest that gender, intervention groups and new positive diagnoses of sexually transmitted infections significantly predict the link between intent and action.
Laura Packel, William H. Dow, Damien de Walque, Zachary Isdahl, and Albert Majura. 2012. “Sexual Behavior Change Intentions and Actions in the Context of a Randomized Trial of a Conditional Cash Transfer for HIV Prevention in Tanzania.” World Bank Policy Research Working Paper 5997, March.
Results from two types of cash transfer programs targeted at adolescent girls in Malawi
The program featured two distinct interventions: unconditional transfers (UCTarm) and transfers conditional on school attendance (CCTarm). Although there was a modest decline in the dropout rate in the UCT arm in comparison with the control group, it was only 43% as large as the impact in the CCT arm at the end of the 2-year program. The CCT arm also outperformed the UCT arm in tests of English reading comprehension. However, teenage pregnancy and marriage rates were substantially lower in the UCT than the CCT arm, entirely due to the impact of UCTs on these outcomes among girls who dropped out of school.
Baird, Sarah, Craig Mcintosh, and Berk Özler. 2011. “Cash or Condition: Evidence from a Cash Transfer Experiment.” Quarterly Journal of Economics 126(4): 1709–53. (Based on World Bank Policy Research Working Paper 5259)
Evidence on the labor impacts of the East Asian crisis
This study of “who is vulnerable in volatile times” shows that, within the same Indonesian firm, women experienced slightly higher job losses than their male colleagues. But the overall effect of such differential treatment was offset by women being disproportionately employed in firms less hard hit by the crisis.
Hallward-Driemeier, Mary, Bob Rijkers, and Andrew Waxman. 2011. “Ladies First? Firm-Level Evidence on the Labor Impacts of the East Asian Crisis.” World Bank Policy Research Working Paper 5789, September.
As countries integrate into the world economy, the costs and benefits of gender discrimination shift. In an increasingly globalized economy, the road to gender equality is specific to each country’s productive structure and exposure to world markets.
Do, Quy-Toan, Andrei A. Levchenko, and Claudio Raddatz. 2011. “Engendering Trade.” World Bank Policy Research Working Paper 5777, August.
Environmental and gender impacts of land tenure regularization in Rwanda
The nation-wide and relatively low-cost land tenure regularization program in Rwanda has improved land access for legally married women, prompted better recordation of inheritance rights without gender bias, and increased investments in soil conservation measures.
Ali, Daniel Ayalew, Klaus Deininger, and Markus Goldstein. 2011. “Environmental and Gender Impacts of Land Tenure Regularization in Africa: Pilot Evidence from Rwanda.” World Bank Policy Research Working Paper 5765, August.
Lasting welfare effects of widowhood in Mali
Households headed by widows have significantly lower living standards on average than all other households in Mali. The adverse welfare effects of widowhood persist even after widows are absorbed into male-headed households such as through remarriage, and they are passed on to children, indicating an intergenerational transmission of poverty stemming from widowhood.
van de Walle, Dominique. 2011. “Lasting Welfare Effects of Widowhood in a Poor Country.” World Bank Policy Research Working Paper 5734, July.
Population, poverty, and sustainable development
Studies show that low dependency ratios (resulting from lower fertility) create opportunities for savings and investment―which, with good policy management, can permanently transform living standards.
Das Gupta, Monica, John Bongaarts, and John Cleland. 2011. “Population, Poverty, and Sustainable Development: A Review of the Evidence.” World Bank Policy Research Working Paper 5719, June.
Gender, caste and schooling in rural Pakistan
Girls in rural Pakistan face two social barriers to primary school enrollment: stigma based on caste affiliation and female seclusion that is more rigidly enforced for girls who have to cross hamlet boundaries to attend school. Providing schools in low-caste dominant hamlets would lead to twice the overall enrollment gain at one-sixth the cost of placing a school in every underserved hamlet.
Jacoby, Hanan G., and Ghazala Mansuri. 2011. “Crossing Boundaries: Gender, Caste and Schooling in Rural Pakistan.” World Bank Policy Research Working Paper 5710, June.
The evolution of global bilateral migration 1960–2000
International migration is spreading across the globe as migrants widen their destination choices. Although global migrants are predominantly male, the proportion of female migrants increased noticeably between 1960 and 2000. The number of women rose in every region except South Asia.
Özden, Çaðlar, Christopher R. Parsons, Maurice Schiff, and Terrie L. Walmsley. 2011. “Where on Earth is Everybody? The Evolution of Global Bilateral Migration 1960–2000.” World Bank Policy Research Working Paper 5709, June.
Does female reservation affect long-term political outcomes in India?
Gender quotas increase the level and quality of women’s political participation, the ability to hold leaders to account and the willingness to contribute to public goods in the long term, but the full impact often materializes only after a time delay---it’s important to consider the longer-term impact to gain a full appreciation of the policy.
Deininger, Klaus, Songqing Jin, Hari K. Nagarajan, and Xia Fang. 2011. “Does Female Reservation Affect Long-term Political Outcomes? Evidence from Rural India.” World Bank Policy Research Working Paper 5708, June.
Female voting behavior in Pakistan
The impact on female turnout and candidate choice of a voter awareness campaign showed that both treated and untreated women in treated geographical clusters are 12 percentage points more likely to vote, and are also more likely to exercise independence in candidate choice, suggesting large spillovers.
Giné, Xavier, and Ghazala Mansuri. 2011. “Together We Will: Experimental Evidence on Female Voting Behavior in Pakistan.” World Bank Policy Research Working Paper 5692, June.
Constraints on the provision of education in Pakistan
Private schools in Pakistan are three times more likely to locate in villages with a public secondary school for girls and (private school) teachers’ wages are 27 percent lower in these villages, suggesting that a shortage of teachers constrains the provision of education: The students in girls’ secondary schools today are the teachers in private schools tomorrow. Public investment in secondary education creates new teachers and spurs private participation in a virtuous cycle.
Andrabi, Tahir, Jishnu Das, and Asim Ijaz Khwaja. 2011. “Students Today, Teachers Tomorrow? Identifying Constraints on the Provision of Education.” World Bank Policy Research Working Paper 5674, June.
Intergenerational linkage and interpersonal inequality in Senegal
Education matters more than inheritance to economic activity, welfare, and inequality in Senegal. Significant gender inequality in consumption is evident, although it can be almost entirely explained by education and (non-land) inheritance. A number of other pronounced gender differences are linked intergenerationally, coming through the mother rather than the father.
Lambert, Sylvie, Martin Ravallion, and Dominique van de Walle. 2011. “Is It What You Inherited or What You Learnt? Intergenerational Linkage and Interpersonal Inequality in Senegal.” World Bank Policy Research Working Paper 5658, May.
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