Wednesday, October 13, 2010

India's Wage-Gender Gap

There is considerable research and debate addressing the wage-gender gap in America. Men tend to make more than women on average as most people know, and economists have set out to busy themselves with answering the question 'why?' There are many reasons that have been looked at, some more significant than others, but that is beside the point here. What are the income gaps between women and men in other countries? Are there any? How big are the gaps? Are the reasons the same or different from the U.S.?
It is safe to say that the answers to these questions will differ from country to country and it would be illogical to aggregate the world. After all a positive coefficient on a variable in one country may have a negative coefficient in another!(http://en.wikipedia.org/wiki/Linear_regression)
Luckily there are a great deal of studies done on this subject. One such study done by Nidhiya Menon et al. from Brandeis University analyzed the wage gap in India in the face of increased competitive forces resulting from India's trade liberalization. Intuitively, we can assume that as the market becomes more competitive, there will be a decrease in costly exclusion of capable women in the workforce. However, this study shows that as India becomes more willing to trade, the wage gap has actually widened!

The Paper is here:
http://people.brandeis.edu/~nmenon/Menon_Rodgers_India_WDResubmission_091608.pdf

Note: This is an economic research paper and is not exactly a light read. It uses econometric procedures to procure statistics from data. These statistics may have serious implications, but like every economics research paper, can never be perfect.

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