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Between 1990 and 2015, India’s real gross domestic product (GDP) per capita grew from US$375 to US$1,572, but its female labour force participation rate (LFPR) fell from 37 per cent to 28 per cent. This gives us a puzzle to solve: Why isn’t India following the same trajectory as most other countries at a similar level of growth, where female LFPR rises with GDP? Raising that rate is a high priority, not only because of the diverse benefits that increased economic autonomy brings women, but also because growth will likely be stronger when more working-age citizens of either gender are employed.
The answer to the low LFPR mystery isn’t a lack of interest on the part of women. The 2011 National Sample Survey shows that over a third of women engaged primarily in housework say they would like a job. That number rises to close to half among the most educated women in rural India.
The answer isn’t lack of apparent political will, either. The government of India has poured huge resources into girls’ schooling, but that hasn’t translated into higher female LFPR as it has in other countries. Initiatives such as Skill India and Make in India have quotas to include women, yet they struggle to recruit women, place them in jobs, and keep them in jobs once they are placed.
Instead, a growing body of research suggests that an important part of the answer appears to be social norms about appropriate behaviour for women, and the enforcement of these norms by women’s parents, husbands, and parents-in-law. The 2011 Indian Human Development Survey shows that a very sizeable fraction of Indian women say they require permission from a family member even to go to the local market or health centre. In the end, it’s pretty difficult to look for a job if you can’t leave the house alone. A survey of men and women, who entered skills training programmes, shows that family pressures and responsibilities was by far the most common reason women didn’t accept jobs or quit them, while low pay was the main reason for men.
When the stumbling block is social norms rather than, say, lack of resources or human capital, then it changes how we can make progress and calls for a smarter policy response.
Get the policies right
How do we provide economic opportunities for women when norms militate against women’s work? I will describe two insights from my recent work with colleagues that give hints on how to change women’s behaviour and draw women into the workforce.
- Give women control over the money they earn
India’s rural workfare programme Mahatma Gandhi National Rural Employment Guarantee Act
ECONOMIC INDEPENDENCE The rural workfare programme, Mahatma Gandhi National Rural Employment Guarantee Act, has achieved some success in targeting women, in part because it provides them employment close to home(MGNREGA) has achieved some success in targeting women, in part because it provides them employment close to home. But, until recently, the default was to pay wages into the bank account of the head of the household, usually male. My colleagues and I ran a large-scale experiment in Madhya Pradesh to test the effect of several combinations of interventions: providing them with their own bank account, having their MGNREGA payments directly transferred there, and giving them basic financial literacy training so they know how to use the account. The study is still underway, but we already have some remarkable results.
We found a range of financial benefits from the different interventions, but women who received all three showed the biggest changes: They were more likely to have worked more, both under and outside MGNREGA; they reported 25 per cent higher earnings and 60 per cent higher bank balances, and were more likely to make household purchases with their own money. ?
- Foster women's social networks
In a recent study, my co-authors and I worked with Self-Employed Women’s Association (SEWA) Bank, the largest women’s bank in India, to offer women customers a two-day course in business skills and how to set goals. In the treatment group (those who were offered the course), half of the women received the offer for them alone, and the other half were invited to bring a friend. We found that, while both sets of women were more likely later to take out a loan than women who didn’t take the course, those who had a friend along were even more likely to do so. Furthermore, those who came with a friend were more likely to use their loans specifically for business purposes, while the women who were invited alone mostly used them for home repair — largely unrelated to their businesses.
Most strikingly, women who were invited to the training with a friend had significantly higher household income and consumption levels four months later, and were less likely to report their occupation as housewife.
When women have little bargaining power in the household, they need to revert to their networks with other women to effect change: We’ve seen this happen in the temperance movement, where women cooperate to influence a household decision, that is, whether their husbands drink. Women can tap into that power to influence other household decisions — what kind of investments to make, and whether or not to work.
While across South Asia, men participate in the labour force at the same rate of around 80 per cent, women’s participation varies widely. Pakistan’s female LFPR is lower than India’s at 25 per cent, but it is rising, while in Bangladesh and Nepal, female LFPR has hovered well above the international average for decades. On March 23-24, 2017, the research group I co-direct, Evidence for Policy Design (EPoD), in collaboration with International Growth Centre and IFMR LEAD, will bring together international scholars and policy actors from across South Asia in Kathmandu, Nepal, to share research on how government initiatives to increase financial access and economic opportunities are affecting the region’s women.
The author is the Mohammed Kamal Professor of Public Policy at Harvard Kennedy School and Co-director of Evidence for Policy Design
Published with permission from Ideas For India (www.ideasforindia.in), an economics and policy portal