Unit 5: Gender and Economy

Changing Livelihood Strategies – Changing Labour Market Prospects

Background to Sustainable Livelihoods Approaches

• Developed in response to dissatisfaction with the RESULTS of development efforts

• Not INVENTED

• EVOLVED from the late 1980s through the 1990s (and still evolving)

Contributions to the development of SLA

• Country work by OXFAM and WORLD BANK on characterisation of the poor

• Experience of wide-range of NGOs & CBOs, bi- & multi-lateral agencies, informing researchers

• Work by ROBERT CHAMBERS and GORDAN CONWAY on RURAL LIVELIHOODS

• Work by AMARTYA SEN on ENTITLEMENTS

Approaches contributing to the development of SLA

• PARTICIPATORY APPROACHES to development

• FARMING SYSTEMS RESEARCH

• Recognition of some of the limitations in MICRO-FINANCE

• New approaches to MULTI-DIMENSIONAL ANALYSIS of POVERTY (including by IFAD)

Slide 3 Background of Sustainable Livelihoods

DFID’s SL Framework

PoliciesInstitutio

nsProcesses

NS

FP

H

The Poor

Vulnerability

ContextShocks

SeasonalityTrends

Changes

influenceLivelihoodStrategies

LivelihoodOutcomes

DFID’s SL Principles

• People-centred• Sustainability-focused• Holistic• Implemented in partnership• Linking the micro with the macro• Dynamic• Building on the strengths of the poor

Choosing alternative livelihood strategy

determined by human and other assets low level of educationUnequal distribution of physical and natural

assetsLack of adequate infrastructure Lack of trust in social organizations Lack of economic variation and market

linkages

Livelihood strategies

Livelihood strategies are adopted irrespective of caste,

ethnicity and to some extent gender except some

specific ones - tailoring, shoe making, jewellery making,

weaving/knitting. Agriculture and livestock is most common among all

castes, ethnic groups including men and women New generation migrating (1/3 population is in village in

community 5).

Livelihood strategies…..

More women perceived that they have higher sensitivity and lower adaptive capacity - family decision making

Families from different caste/ethnic groups having

same or similar livelihood strategies are more or less

uniformly sensitive. Families from the same caste/ethnic groups having

different livelihood strategies were differently sensitive to

the impacts of climate change. Agriculture tool maker is more sensitive to rainfall than jewellery

maker who is more sensitive to ceremonies/festivals although

they are brothers.

Findings

Women or Men in the same family are differently vulnerable if they had different livelihood strategies/occupation such as working in agriculture, teacher and shop runner

Both men and women are uniformly vulnerable if they had same livelihood strategy(ies)

Among livelihood groups, dependent on agriculture and wage labour are more sensitive to climate variability than others

Findings

Some families of socially higher caste are more vulnerable than some families of socially lower caste

Sensitivity and adaptive capacity were also differentiated by the status (health, income, occupation) of his/her spouse

As youths are migrating out temporarily or for longer, their parents had to bear the greater burdens. However, vulnerability depended on the income/remittance men's migration does not necessarily increase women's

vulnerability

Pastoralist societies in Africa and the world over are faced with social, economic and environmental realities that are driving change and impacting their production system and way of life

IN ORDER TO “make ends meet”, that is, to sustain their households, women employ various strategies, including income

diversification- remittance through participation in more than one income-generating

activity, and the involvement of children in income generation

CHANGE AFFECTS PEOPLE in different ways- having land and ownership

“survival strategy” approach, used extensively for analyzing people’s strategic responses to

economic crisis,5 is valuable for exploring the dynamic nature of the environment in which livelihood

decisions are made

Multiple Modes of Livelihood Approach

An alternative framework for understanding contemporary livelihood arrangements in urban areas is the “multiple modes of livelihood” (MML) approach.

The MML approach especially its focus on the relationship between macro-level processes and domestic units.

Intensification of other forms of earning a livelihood. “Livelihood system” refers to “the mix of individual and household strategies, developed over a given period of time, that seeks to mobilize available resources and opportunities” (Grown and Sebstad, 1989: 941), and it has many dimensions, including productive processes, reproduction, consumption, and social relations (Beall and Kanji, 1999

Economic situation

The percentage of people living below the international poverty line (people earning less than US$1.25 per day) has halved in only seven years. At this measure of poverty the percentage of poor people declined from 53.1 percent in 2003/2004 to 24.8 percent in 2010/2011. With a higher poverty line of US$2 dollars per-capita per day, poverty declined by one quarter to 57.3 percent.

Changing Labor Market Prospects

Labour migration presents both challenges and opportunities in a globalized world today.

Women migrants- 1960 had 46.8% and in 2007- 49.6% (UN 2007)

Gender and economic power

All human beings, irrespective of gender, must have equal opportunities to seek out economic opportunities.

People access resources and livelihoods for survival and sustenance. But beyond

that, economic power helps them acquire capabilities that enlarge choices for satisfying and creative lives.

This is the promise of human development

Why does discrimination occur in the labour market?

The 'Taste' Model (Gary Becker) - Discrimination arises here because employers and workers have a  distaste for working with people from different ethnic backgrounds or final customers dislike buying goods from salespeople from different races i.e. people prefer to associate with others from their own group. They are willing to pay a price to avoid contact with other groups. With reference to race, this is equivalent to racial prejudice.

Employer ignorance – Discrimination arises because employers are unable to directly observe the productive ability of individuals and therefore easily observable characteristics such as gender or race may be used as proxies – the employer through ignorance or prejudice assumes that certain groups of workers are less productive than others and is therefore less willing to employ them, or pay them a wage or salary that fairly reflects their productivity, experience and applicability for a particular job.

Occupational crowding effects – Females and minorities may be crowded into lower paying occupations

Gender INEQUALITIES

Gender Inequality Index

Gender Development Index

The Gender-related Development Index (GDI) is a composite indicator of gender equality, developed by the United Nations (UN). It is one of the five indicators used by the United Nations Development Programme in its annual Human Development Report (UNDP). It aims to show the inequalities between men and women in the following areas: long and healthy life, knowledge, and a decent standard of living

Eg:- HDI Country 1995 2000 2005 2008 2011 Rank 97 Sri Lanka 0.473 .. 0.447 .. 0.419 157 Nepal 0.724 0.680 0.665 .. 0.558 172 Afghanistan .. .. 0.709 .. 0.707

What is a labor force

the labor force of a country (or other geographic entity) consists of everyone of working age (typically above a certain age (around 14 to 16) and below retirement (around 65) who are participating workers, that is people actively employed or seeking employment

Formal and informal labor Informal labor in the world Informal labor and gender Agricultural and non-agricultural

labor Agriculture and gender Paid and unpaid labor Unpaid labor and gender

Labor Market Discrimination

The definition of Labor Market Discrimination is: It exists when 2 equally qualified individuals

are treated differently solely on the basis of their gender, race, ethnicity, disability, etc.

Feedback effects of labor market discrimination

Faced with labor market discrimination that lowers the returns to human capital investments, women have less incentive to undertake them.

Women’s economic outcomes are therefore adversely affected both directly and indirectly by labor market discrimination.

Feedback Effects

Gender Division of Labor in the

Family

Gender Differences in Labor Market

Outcomes

Similarities & Differences in Characteristics of Male & Female Full-Time Workers

Men and women have similar amounts of education.

Men have more full-time experience and women have more part-time experience.

Men are more likely to be in blue-collar jobs and to work in mining, construction, or durable manufacturing. Women are more likely to be in clerical or professional jobs and to work in the service industry.

Feed Back

If such behavior is encountered it is only logical that those being affected by this labor market discrimination view the returns on human capital investment to be lower

Consequently they will have less incentive to invest in human capital

Feed Back

Furthermore, if this “feed-back” is widely spread such as to be “known” by younger individuals it could even lead to many dropping out of school or not pursuing higher education or advanced degrees

Glass Ceiling

In 1991 as part of the Civil Rights Act of 1991, 21 member committee was formed and chaired by the Labor secretary to determine if there was a “glass ceiling” in the upper management of American firms

Glass Ceiling

In terms of the findings of the commission

There is a glass ceiling and the derives from three sources:Societal/Non-MarketBusinessGovernment

Glass Ceiling

In terms of those reasons under the control of business are:

Outreach and recruitment practices that do not seek out or reach or recruit minorities and women

Corporate climates that alienate and isolate minorities and women

Pipeline Barriers that directly affect opportunity for advancement

Initial placement and clustering in staff jobs or in highly technical and professional jobs that are not on the career track to the top

Glass Ceiling

In terms of those reasons under the control of business are (continuation):

Lack of mentoring Lack of management training Lack of opportunities for career development,

tailored training, and rotational job assignments that are on the revenue-producing side of the business

Glass Ceiling

In terms of those reasons under the control of business are (continuation):

Little or no access to critical develop mental assignments such as memberships on highly visible task forces and committees

Special or different standards for performance evaluation

Glass Ceiling

In terms of those reasons under the control of business are (continuation):

Biased rating and testing systemsLittle or no access to informal net-works

of communication Counterproductive behavior and

harassment by colleagues

Glass Ceiling

In terms of those reasons under the control of government are:

Lack of vigorous, consistent monitoring and law enforcement

Weaknesses in the formulation and collection of employment-related data which makes it difficult to ascertain the status of groups at the managerial level and to disaggregate the data

Inadequate reporting and dissemination of information relevant to glass ceiling issues

Measuring Discrimination

However, measuring discrimination is not that simple

For instance,Looking at only wages does not represent

the true level of discrimination since it is likely that personal characteristics may account for some of that disparity

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Gender inequalities :- eg from europe Violence against women and pay gaps: most important inequalities according to Europeans

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B. Gender inequalitiesSignificant variations exist between countries: violence is the leading issue in 12 Member States

Violence against women

The pay gap between women and men

Trafficking in women, prostitution

The small proportion of women in positions

of responsibility in companies

EU27 48% 43% 36% 30%

ES 74% 42% 42% 22%

SE 64% 53% 47% 21%

RO 62% 23% 54% 20%

LT 60% 41% 40% 12%

IT 58% 23% 37% 32%

PT 57% 35% 42% 27%

EL 55% 23% 47% 20%

DK 51% 34% 60% 15%

MT 50% 31% 34% 31%

UK 50% 35% 47% 23%

FR 49% 54% 24% 37%

SI 48% 33% 26% 31%

BE 47% 50% 35% 32%

In your opinion, which of the gender inequalities in the following list are the most important? First? And then ? (3 ANSWERS MAXIMUM)

The Overcrowding Model

The labor market exhibits SEGREGATION

Consequently:Some jobs are male jobs other are female

jobsSome jobs are white jobs other are minority

jobs

The Overcrowding Model

Assume that workers F and M (female and male) are perfect substitute for each other (i.e. they are homogenous)

Let the labor market be divided into two type of jobs. Job type F accounts for a quarter of the jobs available and job type M accounts for three quarters of the jobs available.

The Overcrowding Model

At first assume that both jobs on average pay the same wage.

Under this circumstances then we would have the following graph

Overcrowding

Labor

WageSfo

Df

Lf0

F Occupations

W0

Labor

Wage

Dm

Smo

Lm0

M Occupations

W0

Suppose that men and women are equally qualified for occupations F and M. Then the wages for those jobs will be the same (W0).

Overcrowding

Labor

WageSfo

Df

Lf0

F Occupations

W0

Labor

Wage

Dm

Smd

Smo

Lmd Lm0

M Occupations

Wmd

W0

If women are excluded from the M occupations, the reduced supply in those jobs results in higher wages.

Overcrowding

Labor

WageSfo

Sfd

Df

Lf0 Lfd

F Occupations

W0

Wfd

Labor

Wage

Dm

Smd

Smo

Lmd Lm0

M Occupations

Wmd

W0

In the F occupations, where women can get jobs, the supply of workers is increased and the wages fall.

The Overcrowding Model

Now assume that at least one of the following is possible: M workers can move easily between job types, yet

F workers can not. F workers can find F type jobs but can enter into M

type jobs. F workers prefer to work only F type jobs Employers of M type jobs will not hire F workers Some other reason that will concentrate F workers

only to F type jobs

The Overcrowding Model

Based on the previous scenarios:Workers will begin to concentrate in F type

jobsThere will be less available workers for M

type jobs In a sense, F type jobs become less

“important” than M type jobs orF type jobs become subservient to M type

jobs

The Overcrowding Model

F type Jobs M type Jobs

w

$ $

L L

S S

DD

wF

wM

LF LM

The Overcrowding Model

After the overcrowding in the F type jobs the result is thatThe wages in the F type jobs are lower than

the wages in the M type jobs (i.e. wM>wF)This time, F type jobs account now for more

than a quarter of the jobs available (LF) and M type jobs accounts for less than three quarters of the jobs available (LM) .

Models of Labor Market Discrimination

Tastes for DiscriminationGary Becker conceptualized discrimination

as a personal prejudiceU=U(,W,B)Where U is the utility of the employer are the profitsW is the number of White workersAnd B is the number of Black workers

Internal Labor Market

The assumption is that certain firms will generally only promote from within. If for whatever reason, entry level jobs attracted a

certain type of worker or if only certain type of worker will be retained or if only certain type of worker will stay in that job Then upper management will be composed of that

type of worker that remains in that entry level position

Internal Labor Market

Wag

es (

$)

Job Ladder

Firm-Specific Training

Primary and Secondary Jobs

The assumption is that certain firms will generally only promote from a certain type of entry jobs.

In other words, some entry jobs will only allow the workers to reach certain heights within the organization

Internal Labor Market

Wag

es (

$)

Job Ladder

Primary

Secondary

Feedback Effects

Some times employees and employers may discriminate by bringing into the work place the behavior exhibited in the household

So gender roles played in the household labor

are parallel in the work labor

Efficiency

Unequal treatment on the basis of gender, etc. may result in an inefficient allocation of resources.Prices do not serve as accurate indicators of social costs. Consider for example, the overcrowding model. Since female labor is underpriced, firms will produce too much of the outputs produced by that labor. Since male labor is overpriced, firms will produce too little of the outputs produced by that labor.In addition, since women are deterred from investing in their human capital by discrimination, society loses a valuable resource.

What is Discrimination

Disparate Treatment Discrimination treating two otherwise equal people differently on the basis of race

Adverse Impact Discriminationdoing something that is not necessarily discriminatory on its face but that impacts some groups more negatively than others

Rational or Statistical Discriminationdiscrimination that is based on sound statistical evidence and is consistent with profit maximization

Measuring and Detecting Discrimination

Regression techniquesStatistical methods which seek to determine

if the differences in treatment for whites and blacks could have happened by random chance.

Auditing techniquesSending paid actors into a situation to

determine if people with identical economic characteristics are treated differently based on race.

Why Competition Would Eliminate Discriminatory Pay

Businesses that hired only whites at the higher wage would have higher costs than businesses that did not discriminate.

Businesses that did not discriminate could lower their prices and take the market share of those firms that did discriminate.

As this happened firms would see that discrimination was not consistent with maximizing profits and would stop discriminating.

Why Competition Would Not Necessarily Eliminate Discrimination

In industries where there is economic profit, firm owners may continue to discriminate and consider it a price they are willing to pay so as to not employ blacks.

In industries in which the customer chooses which business to patronize based on race, firms may be willing to discriminate because their profit maximizing interest and discrimination are consistent.

Why Women Make Less than Men

PregnancyLoss of time in the field and intermittent

absence can put women at a economic disadvantage. (Many times this difference in treatment is against the law.)

Stay-at-home Moms98% of stay-at-home parents are women

leaving them out of the job market for extended periods of time.

Why Women Make Less than Men (continued)

Different ProfessionsTeachers Nurses Social Workers Day Care workers Secretaries

Why Women Make Less than Men (continued)

Flexible EmploymentWomen, more than men, tend to choose

jobs that allow them to deal with her children’s activities and illnesses.

Sociology vs. Economics

Economic Explanation for pay differences People make choices and one of the consequences of

those choices is their earning capacity. If women choose

professions that do not pay well, to have and stay home with children jobs that allow them to deal with their children

they will make less money.

Sociology vs. Economics(continued)

Sociological Explanation for pay differencesWomen are socialized

to pick certain professions into being the parent to stay home into being the parent that sacrifices career

for familywhich causes them to be paid less.

Labor participation rate, female (% of female population ages 15+)

Labor force participation rate is the proportion of the population ages 15 and older that is economically active: all people who supply labor for the production of goods and services during a specified period. eg: 2008 2010

Afganistan: 15 16 Nepal: 80 80 Sri Lanka: 37 35

Gender Division of Labour

Economic situation…Nepal

Real wages continue to rise, and have beenaccommodated by monetary easing sinceearly FY11, adding to inflationary pressures:- Nepal

Wages have been rising faster than consumer prices; the wage index rose by 31 percent y-o-y in FY11 (measured in mid-June).

Agricultural labor wages rose fastest, at 40 percent, followed by regular worker wages (33 percent) and wages for construction workers (30 percent).

Large scale outflow of migrant workers and the resulting worker shortages also explain the wage increases. In addition, huge remittance inflows in the recent past have increased aggregate demand (i.e., consumption) without raising the nation’s production capacity.

Socio-economic scenario

More women migrants

Gender Inequality Index (GII) Trends, 1995-2011HDR 2011\Copy of HDR_2011_Statistical_Tables.xls

Country 1995 2000 2005 2008 2011

Afghanistan .. .. 0.709083 0.694532 0.706641

Nepal 0.723855 0.680303 0.665001 0.562817 0.558202

Sri Lanka 0.473118 .. 0.447285 0.429996 0.419032

Remove barriers to assets Expand paid employment Deepen the benefits of education Invest in womens health Make mobility safe

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F. Conclusion

Gender inequality problems, in general, and pay gaps in particular, are regarded as serious by a very large majority of Europeans

To combat pay gaps, sanctions and incentives are rated equally

In terms of the trade-off between work and child-minding (father/mother), stereotypes persist

The EU level remains the most appropriate scale for tackling these problems

To promote gender diversity in "male" and "female" occupations, the improvement of working conditions is necessary in most Member States

Analysis by group of countries, by country and using socio-demographic criteria demonstrates genuine complexity in the structure of opinions of gender inequality are formed