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Introduction:
The earth, possessing 7 billion people, mostly comprises two genders – male and female, lives in
different states but mostly working for a same goal – attaining economic growth followed by
holistic development where trade acts as one of the main tools as not surprisingly some are poor
and others are rich, question arises – whether the trade which need to be liberalized and done
years ago helps actually to attain development or increases gender gap?

It is obvious to have a good economic growth and it is trade which helps greatly to attain the
economic growth regardless the region, state and others where it is the product which plays a
very important role. From wide-ranging perspective, trade is thought to be done through material
and industrial products where as human can be a great source of trade, undoubtedly need to be
liberalized to attain maximum level of output where gender discrimination need to be restricted
strictly, a very bad news, economical tradeoff is greatly found in this regard. Many may counter
the argument that whether trade liberalization increases gender gap or not thus this writeup will
try to find the impact of trade liberalization with special reference to gender discrimination and
inequality issues.

What is gender discrimination and inequality?

According to Oxford Reference, gender discrimination is a “Social process by which people are
treated differently and disadvantageously, under similar circumstances, on the basis of gender.”
("Gender inequality - Oxford Reference", 2017)

Besides, according to Sage Knowledge, “Gender inequality can be defined as allowing people
different opportunities due to perceived differences based solely on issues of gender. Gender
discrimination is the prejudicial treatment of an individual or group due to gender. Gender
inequality and discrimination are generally discussed as pertaining to women, but anyone can
experience gender-based inequality or discrimination.” ("SAGE Reference - Gender Inequality
and Discrimination", 2017)

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What is trade liberalization?

According to Investopedia, trade liberalization is nothing but the removal of barriers of the
market on the free exchange of goods between nations including the reduction of tariff obstacles
such as duties and surcharges, and nontariff obstacles, such as licensing rules, quotas and other
requirements. Eradication of these restrictions is often referred to as promoting "free trade."
(Staff, 2017)

Trade liberalization involves:

• Reducing tariffs

• Reducing/eliminating quotas

• Reducing non-tariff barriers. (Pettinger, 2017)

Trade liberalization vastly talks about the reducing trade barrier and all other stuffs which will
increase the market mechanism making it more competitive fortunately or unfortunately by
involving the foreign products in domestic markets, not surprisingly may harm the infant
industries while grooming up. However, trade liberalization is good to some extent for the
possession of lower costs to consumers due to lower fees and additional competition. (Staff,
2017)

Now, looking back to the production line of any farm following the trade liberalization protocol
and attaining profit, how much they are fair in the gender issues while appointing, giving wages,
distributing appointments? Are they maintaining the gender discrimination protocol followed by
many from the ancient period or trade liberalization is going to or already been started to create a
new motion by reducing the gender gap through it’s policies and other stuffs – is matter of
concern which this writeup will try to clarify.

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Brief notes about the impact of trade liberalization on gender issue –

world economic perspective:
"...experience in open, low-income countries until now has clearly been that
industrialization has been female-dependent as well as export-led, and many women in
outward-oriented developing countries owe their livelihoods to international trade
expansion." (Joekes, 1999 p.36).

This quote denotes the importance and uprising of women in the era of industrialization,
globalization followed by trade liberalization, a very good news, an alter approach of the
common phenomena that general people possess regarding gender issues due to trade
liberalization and all other contemporary concepts come forward not fully though but to a great
extent. Very surprisingly, a literature, reviewed by Joekes (1999), came up with an incredible
concluding remarks that they mainly found a positive relation between trade expansion and
women's participation in the workforce and the relative wages of women. Undoubtedly a matter
surprise that the positive gender effect is largest in the lowest income countries.

Focusing on the exporting industries though trade liberalization undoubtedly leads to changes
(positively indeed) in import penetration where a recent paper argues that, due to a more open
trade regime, increased competition is face by local markets, not surprisingly can no longer
sustain with the discrimination business against women by paying a premium on male workers
just because they are men due to the threat of inefficient productivity. The study finds empirical
evidence for this hypothesis in USA (Black and Brainerd, 2002).

It is found that labour-intensive industries become concentrated in developing countries followed

by women employment which obviously bless them with new experience and new job
opportunities. An opposite scenario is seen in developed countries, women started losing jobs that
we can see in the data from 1978-95 which finds the correlation coefficient of trade liberalization
and OECD countries negative; trade with developing countries has a negative impact on female
employment in 22 OECD countries as women's job losses in the OECD are mainly in the

• Textiles,

• Apparels, and

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• Leather industries. (Kucera and Milberg, 2000).

But the data from the period 1960-85 indicates another movement of trade and gender that trade
between developed and developing countries corresponded with an increasing share of female
employment in developing countries but found no change in the gender composition of developed
country employment (Wood 1991) which clearly states that liberalized trade brought and
bringing bad impacts on women of developed countries to some extent as they are not labour
intensive. Another study found that, the wages earned by the women in these industries of
developing countries generally exceed the alternative sources of income for women (Joekes,
1999).

Apart from that, trade liberalization of the telecommunication sector resulted in rapid increased
uses mobile phone alongside accessibility on internet penetration rates, a very good news, mostly
found in third world countries which led the establishment of new business and job opportunities
for women. It has opened the opportunities for women to be an entrepreneur can perform working
from home specially in the sectors of handicraft, bakeries etc. and selling their products over the
Internet. (UNCTAD, 2002). According to UNCTAD (2002), “There are also examples of networks
of such entrepreneurs, for example a network of housewives making confectionaries from home
and selling over the Internet in Peru.1 In Asia 35 per cent of small and medium sized enterprises
are run by women. Many of them have been able to take advantage of the new opportunities
provided by the Internet and improved their market access as well as access to intermediate
products and in some cases eliminated middlemen and kept more of the sales revenues for
themselves.”

Besides, UNCTAD (2002) denotes that advanced and expanded modern technologies created job
opportunities for the women in outsourcing business of back office non-core services such as hotel
and airline booking, mailing list maintenance, various other forms of data entry and information
processing etc.

1
Please see http://www.tortasperu.com.pe/ingles/conditions.php

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According to (Nordås, 2003), “Women dominate routine work requiring basic and intermediate
skills in back-office services in India, while men dominate in the high-skills jobs in this sector.
The proportion of women working in call centres varies between 40 and 70 per cent.”

However, now we will see the impact of trade over 3 types of countries i.e. A. Countries Abundant
in Unskilled Labour; B. Countries Abundant in Natural Resources and Land; C. Countries
Abundant in Semiskilled Workers.

➢ Countries Abundant in Unskilled Labour

“Trade liberalization in poor countries has often started in export processing zones
where producers can import inputs free of duties provided that the final product is
exported” (Nordås, 2003).

These EPZs inclines to attract the light industries like clothing, footwear etc. which are
dominated by women, a very good news, women are blessed with new job opportunities at
the early stages of trade liberalization in labour-abundant poor countries - at least if we
assume that even a low-skill, low-wage job is better than no job.

Bangladesh is a study of the gender dimension of trade liberalization in poor countries

(Fontana and Wood, 2000). Undoubtedly Bangladesh is abundant in labour where the
garments industry accounts for 60 percent of export revenue possessing more than 80% of
employees in are women. Paper cited above develops a computable general equilibrium
model (CGE) and simulates the impact of trade liberalization on employment and wages
from the lens of the gender dimension.2 The result is a sharp expansion of the exporting
manufacturing sectors and labour force is shifted from agriculture to industries. Thus,
employment, absolute and relative wages of women increases. (Nordås, 2003).

2
The model builds on a social accounting matrix (SAM) that distinguishes female and male labour. It also
includes household work and leisure.

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A study on Turkey using firm-level data analyses the relation between exports and female
employment and found an incredible result - strong positive relation between exports and
female share of employment at the firm level. Further findings of the study are, the female
share is higher where workers are

▪ Less skilled,

▪ Use less capital-intensive and

▪ Energy-intensive technology (Ozler, 2000).

Tunisia, a state, changed policies from import substitution to a combination of import

substitution and export promotion, towards a more liberal and neutral trade policy regime
during the period 1970 to present. Major exports of Tunisia are textiles, apparel and other
labour-intensive manufactures. While studying the impact of trade liberalization on
employment patterns and wages finds of Tunisia, scholars found that due to women's
increased labour force participation employment increased in both the exportable and
importable sectors during liberalization (Haouas et. al., 2003). Apart from that, the study
finds that real wages have increased during the liberalization period. That changes in real
wages caused changes in employment. The latter finding suggests that the rising wages
that have mobilized women for labour force participation, increased workforce
participation by women and job creation both in import-competing and export-competing
industries following liberalization is also found in Mauritius. (Nordås, 2003).

From the above-mentioned circumstances, it clearly visible that, countries having

abundant unskilled labour has less gender gap specially in the early stages.

➢ Countries Abundant in Natural Resources and Land

A bit dense population and rich natural resources are found in few poor countries like Sub-
Saharan Africa and Latin America where trade liberalization is expected to shift from
labour – capital intensive to natural – resource intensive industrialization, not surprisingly
increases the price of the land and other relative components and the income distribution
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effect, not a very good news, depends on the ownership of these stuffs. More even-
distribution of natural resource ownership is appreciated for the sub-Saharan African
countries to shrink the level of detriment despite the workers will still get less than the
owners whereas, in the case Latin-America, less even distribution is expected. However,
impact of gender gap largely depends on the ‘Division of Labour’ in may poor societies
where women play an important role in sales and distribution of the products from farms
and fisheries - a contextual concept, is enhanced with the openness of trade, indeed.
(Nordås, 2003).

Few African countries showed a deterioration of the relative position of women within the
household which is observed as the family farm shifts towards production of cash crops for
exports despite it may increase the total family income. An alter scenario is seen that job
opportunities outside the family farm improve the relative position of women. Horticulture
is an emerging sector in several poor countries following trade liberalization. It increases
the exports, which again is a female dominated sector (Joekes, 1999).

On the contrary, men dominate the mining and mineral processing industries both in
developed and developing countries, e.g. Zambia is found with only 7% women employed
in the copper mining sector where Copper brings almost 80% of export revenues there.
While analysing the effects of trade liberalization on women in Zambia by means of a CGE
model, Fontana (2002) concludes that employment and the absolute wage of women rise
with trade liberalization, but less than for men such that the relative position of women
deteriorates slightly. (Nordås, 2003).

➢ Countries Abundant in Semiskilled Workers

Disproportionate gains to women are found reversed in terms of employment with rising
trends of technology in industrial development (Joekes, 1999). But an alter approach is
found in fast growing Asian countries where female share in employment has actually
increased followed by decreased the wage gap (Nordås, 2003).

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Observing the case of South Korea, we found increased wage gap between men and women
during 1971-83 but decreased after 1983 (Rogers, 1996; ILO, 2002).

In Malaysia, women's wages in manufacturing increased in a period when technology was

upgrading in exporting industries from,

o 54 per cent of men's wages in 1992

o 63 per cent of men's wages in 1997 (ILO, 2002).

In Argentina, Brazil and Costa Rica, female labour force participation has significantly
increased due to trade liberalization though Argentina faced increased unemployment and
underemployment due to inflexible labour market (Cunningham, 2001).

According to Nordås, (2003), “The sketchy empirical evidence on the relation between trade
liberalization and gender in developing countries with a reasonably well-educated labour force is
inconclusive on a sector level, but it appears that women's participation in the labour force
increases with the level of income and that the wage gap narrows in the process.”

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Statistical Illustration:
Here we will analysis the data of five countries for the comparative study are Mauritius, Mexico,
Peru, the Philippines and Sri Lanka.

The selected cases are all middle-income although

o Sri Lanka and the Philippines are at the lower end of the middle-income group.

o Peru is relatively abundant in natural resources

o The others are relatively abundant in unskilled or semi-skilled labour.

Figure 1 shows the composition of GDP by economic activity.

o The Philippines and Sri Lanka have relatively large agricultural sector

o Mauritius has the highest manufacturing share of GDP, followed by the Philippines,

o Mexico has the highest services share of GDP at 67 per cent. (Nordås, 2003).

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In table 1, key economic and social indicators for the five case studies are provided.3

o Mauritius is the country with the highest average effective tariff rates,
o Mexico is clearly the most open economy when judged by the effective average tariff
rate.
o Mexico is part of a regional trade agreement with the US and Canada (NAFTA),
o Mexico’s almost three quarters of its imports come from the US, while non-NAFTA
countries meet much higher trade barriers in Mexico.4

3
All variables are for 2000 unless otherwise stated. GDP per capita is in constant 1995 dollars, secondary
school data are for 1998 for all countries, HDI ranking is for 2002, and unemployment rates are for 2001 for Mexico,
Peru and the Philippines.
4
Please see Ianchovichina (2000) and Hanson (2003) for a discussion.

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The table indicates that

o Women fall behind men in employment opportunities particularly in Mauritius and Sri
Lanka,
o Unemployment among women are about twice as high as for men.
o Literacy is higher for men in all the countries,
o Girls constitute about half of the pupils in secondary school and women are therefore
likely to catch up on literacy over time,
o Life expectancy is higher for women in all countries (Nordås, 2003).

According to Nordås, (2003), “Turning to the labour market, the share of women in the labour
force varies substantially between countries. However, during the four decades between 1960 and
2000 women's share of the labour force increased steadily in all the countries in the sample. In
1960 women accounted for the lowest share of the labour force in Mexico at only 15.3 per cent.
However, Mexico is also the country in the sample where women's share of the workforce has
increased the most, more than doubling during the period in question. The Philippines has had the
highest share of women in the workforce throughout the period in question, reaching 37.8 per cent
in 2000.”

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To some extent all these data have shown the women participation in different sectors of the
given 5 countries of different years which helps to get a clear and concise idea about the gender
issue related with trade liberalization concept developed over years with a view to make an equal
globe from a holistic perspective though the consequences were not 100% positive, indeed.

Now we will try to illustrate the relationship between trade liberalization and gender issues
through some statistical tools:

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In table 7, we notice that trade patterns bring many gender-related employment variation in
Mauritius and Sri Lanka, while it can explain only a small share in Mexico. Regression analysis
can be an alternative illustration procedure to see woman’s employment on changes in exports and
imports, controlling for changes in total employment. The results are presented in table 8. (Nordås,
2003).

In table 8, we found no significant relation between changes in trade and changes in women’s
employment in Mexico and Peru. A similar pattern as that presented in table 7 is found for
Mauritius, the Philippines and Sri Lanka.

According to Nordås, (2003), “There are two possible explanations for this finding. One
explanation is that export competing industries tend to employ women while import competing
industries tend to employ men. The other possibility is that as an industry improves its export
performance, it tends to employ more women. Likewise, if an industry faces more import
competition, it tends to employ more men, or lay off women first. In order to establish which
explanation is the more likely, additional analyses that distinguish between variations within
industries over time and between industries were undertaken. It turns out that the variation is
mainly between sectors and thus employment in export competing industries tend to be dominated
by women while import competing industries tend to employ men. The variations between sectors
account for most of the total variation and are presented in table 9.”

After analysis of the table 9 and 10 , we can say that there is a negative relation between women’s
share of employment and women’s wage rate relative to men in both Mexico and the Philippines
whereas a significant relationship between women’s relative wages and trade is found only in the
case of imports to the Philippines. Moreover, table 7 showed a statistically significant relationship
between women’s share of employment and trade (Nordås, 2003).

Finally, one could say that there is an indirect relationship between trade and wages to osme extent
with special reference to these two countries (Nordås, 2003).

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Analysis of the impact – My view:

• Arguments
According to Nordås (2003), “The relationship is as predicted by trade theory: a
country rich in unskilled labour tend to export labour-intensive goods, which in
turn tends to pay low wages compared to capital-intensive and skills intensive
sectors. Labour-intensive sectors also tend to employ women.”
I argue that trade liberalization is pretty much good for reducing the gender gap specially
for the third world countries where infant industries are found booming through less trade
barrier to some extent a result of Doha Round. Besides, trade liberalization with a merge
of technological advancement helps women to work in diverse sectors being in home,
undoubtedly a very good news, helps to increase the GDP as well women participation in
the market.

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In Bangladesh (Khisa, 2017):

• Counter arguments

The statement of Nordås (2003) showed a clear opposite argument regarding the trade and
gender issue as he denoted that high skilled works are dominate by the men as opened
opportunities for women are not that much compatible than the men are performing. The
empirical data of recent cases shows that though the existence of trade liberalization found,
in many countries gender inequality is found drastically, especially in OECD countries.
From (Khisa, 2017),

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More recent studies of ILO has also shown the gap of women in Asian countries (Khisa,
2017):

From the above-mentioned data set, I argue as a counter of previously mentioned argument
that, not always trade liberalization reduce gender gap rather increases to some extent
specially in developed countries where high technology is used. Besides, women are being
considered as weaker than men which creates a natural bias towards men and thus, in many
high appointments, men are preferred, not worthy, indeed. Women are considered as more

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home-sick than men which is also refrain them to be appointed or indulged in market as
freely as men. Thus, I want to state that, trade liberalization not always but in many cases
increases gender gap though it is a contextual concept keeping in the concern that it has
alter results as well in many poor countries.

Recommendations and Concluding Remarks:

Gender inequality, a global problem can be very well termed as one of the most important
consequences of the process of trade liberalization.

Trade, not less than a way to attain a sound amount of economic growth followed by economic
development, a very good news, to some extent, helps in improving the state of holistic
development but only works most effectively under some condition e.g. gender equality, trade
liberalization, etc. most often found under a cause and effect situation between trade
liberalization and gender inequality not surprisingly questions the benefits of trade liberalization.

From the whole write up, we have seen that trade liberalization reduces gender gap in poor
countries but accelerates in few rich countries to some extent. To mitigate these, we need to
liberalize our lens to look towards women. Women can perform many tasks better than men
which have to be recognized neither development won’t take place, indeed.

Finally, we want to say that, policy implication can reduce gender gap keeping compliance with
the trade liberalization, undoubtedly will be a good way to be developed, indeed.

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