Gendered Impacts Of Trade And Labor Market Institutions: From Export Processing Zone To Free Trade Agreements

Abstract

<title>Abstract</title> The given empirical investigation questions the introduction of gender and labour provisions into free trade agreements (FTAs) and their still-cursing implications on women entering the manufacturing industry. We have set up a panel that includes five developing economies between 2000 and 2024, and have used an event-study, or rather a difference-in-differences design, to track the causal impact of so-called gender-responsive FTAs on female industry employment. In our estimation exercise, it indicates no statistically significant change in the share of women in industrial jobs due to the support of FTAs with gender and labor clauses, and at best, a short-lived reduction is observed. We established the exogeneity of our treatment in advance, performing strict pre-trend diagnostics that support parallel trends in female labor participation between the treated and control units during the period preceding ratification of the FTAs. The overall implications of these results are that, unless accompanied by explicit strategies to address income distribution and inequality among people experiencing poverty, even the explicit inclusion of gender equity and labor rights provisions in trade does not necessarily increase women's industrial employment in the near term. We offer several plausible hypotheses for the reason behind this counterintuitive result. The first issue is entrenched labor market segmentation, and the second is the lack of enforceability of negotiated provisions. Evaluate the effects, ask questions, and ensure that most environmental designs are practical and feasible. Based on these factors, it follows that to realize the empowering potential of international trade, such as gender provisions in FTAs, there must be strong domestic labor institutions, a robust enforcement system, and complementary interventions, exemplified by targeted skills development programs and anti-discrimination laws. Therefore, developed countries have a moral obligation to strengthen the connection between trade policy and the economic empowerment of women by establishing a harmonized approach that may involve international agencies, such as the WTO, UN Women, and ILO, along with their respective governments.

Affiliated Institutions

• Kazan Federal University RU

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