Does Female Empowerment Promote Economic Development?
Empirical evidence suggests that money in the hands of mothers (as opposed to fathers) increases expenditures on children. Does this imply that targeting transfers to women promotes economic development? Not necessarily. We consider a noncooperative model of the household where a gender wage gap leads to endogenous household specialization. As a result, women indeed spend more on children and invest more in human capital. Yet, depending on the nature of the production function, targeting transfers to womenmay be beneficial or harmful to growth. Transfers to women are more likely to be beneficial when human capital, rather than physical capital or land, is the most important factor of production. We provide empirical evidence supportive of our mechanism: In Mexican PROGRESA data, transfers to women lead to an increase in spending on children, but a decline in the savings rate.
We thank the editor Oded Galor, two referees, Nava Ashraf, Abhijit Banerjee, Lori Beaman, Chris Blattman, Antoine Bommier, Areendam Chanda, Stefan Dercon, Garance Genicot, Doug Gollin, Andreas Irmen, Dean Karlan, Martina Kirchberger, John Knowles, Per Krusell, Ghazala Mansuri, Sonia Oreffice, Josefina Posadas, Mark Rosenzweig, Nancy Stokey, Silvana Tenreyro, Duncan Thomas, Hitoshi Tsujiyama, Dominique van de Walle, Martin Zelder, and participants at many seminar and conference presentations for helpful comments that greatly improved the paper. Financial support from the World Bank’s Gender Action Plan, the National Science Foundation (grants SES-0820409 and SES-0748889), the European Research Council (grant SH1-313719), and the German Science Foundation through CRC TR 224 (project A03) is gratefully acknowledged. Titan Alon,Marit Hinnosaar, Vuong Nguyen, XiaodiWang, and Veronika Selezneva provided excellent research assistance. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.
Matthias Doepke & Michèle Tertilt, 2019. "Does female empowerment promote economic development?," Journal of Economic Growth, vol 24(4), pages 309-343. citation courtesy of