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Citation Information

Type Working Paper
Title Globalization and the gender earnings gap: evidence from Sri Lanka and Cambodia
Author(s)
Publication (Day/Month/Year) 2016
URL http://documents.shihang.org/curated/zh/699061482849262999/pdf/WPS7930.pdf
Abstract
Disasters in Bangladesh and protests elsewhere have created
an intense debate about the value, particularly to women,
of apparel employment in developing countries. This paper
focuses on how the forces of globalization, specifically the
Multi-Fibre Arrangement (MFA), have affected women’s
wages in the apparel sector in developing countries. The
paper uses household and labor force surveys from Cambodia
and Sri Lanka to estimate both apparel wage premiums
relative to other industries and the male-female wage gap
before and after the end of the MFA. The approach builds
on new models that apply traditional trade theory (e.g.,
the Heckscher-Ohlin and Stolper-Samuelson theorems) to
analyze the effect of globalization on gender-based earnings.
The authors find large positive wage premiums and
a closing of the male-female wage gap during the MFA
period, but smaller premiums and a widening wage gap
after the end of the MFA. The results suggest that the benefits
of apparel exports for women in developing countries
remain significant post-MFA. They also model an approach
for studying the effects of globalization that differentiates
males and females as separate factors. This may be a
fruitful alternative to discrimination models or those that
analyze the effects of globalization on women in terms of
skill. Further research is necessary to identify the potential
development effects of post-MFA apparel employment
and to thoroughly compare the benefits documented in
this paper with the costs that may come with apparel jobs.

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