Wednesday, August 25, 2010

Did trade liberalisation benefit women? The case of Mexico in the 1990s

by Ernesto Aguayo-Téllez, Jim Airola and Chinhui Juhn

August 24, 2010

Promoting gender equality is a Millennium Development Goal. This column explores the effects of trade liberalisation in Mexico during the 1990s on the country’s gender gap. It finds that trade benefitted sectors of the economy that employ more women, such as textiles and clothing, thereby helping to raise women’s earnings and relative social status.

Promoting gender equality is one of the eight Millennium Development Goals of the United Nations (UN 2009). The potential paths to achieving this goal are many. An oft-cited path is to raise global awareness of the issue and to directly campaign for change. Another possibility may be to integrate poorer and less-developed economies into world markets by encouraging trade liberalisation.

This latter route merits further exploration. A large body of research documents the effect of trade liberalisation on skill premiums (see for example Robbins 1996, Wood 1997, Behrman et al. 2000)1. Among studies that examine gender outcomes, Oostendorp (2009) presents a cross-country analysis of the responsiveness of the gender gap to measures of trade and FDI. He finds that trade and FDI inflows reduce the gender gap among low-skilled occupations, while results are mixed for high-skilled occupations (see also Bussolo and De Hoyos 2009).