Abstract:
I seek to answer these questions because, as pointed by Seguino and other authors (see e.g. Berik et al. 2011), there may exist a set of conditions under which an attempt to increase women’s wages will prevent economic growth. This is a challenging scenario for the international organisations when /if they aim for both the empowerment of women, defined by their ability to increase their earnings, and economic growth.
By using a structuralist model by Blecker and Seguino (2002) the paper is able to recognise the mobility of firms as the main constraint to realise an optimistic scenario in which the conflict between higher wages and economic growth is overcome. Furthermore, I use a model of monopsonic labour market, in which the firm is able to pay the marginal unit of labour beneath its productivity, to show that the low female wages can be due to other factors than productivity.
I conclude that both the Beijing Declaration and the strategic papers from the World Bank fail to address the constraints that limit women’s earnings opportunities stemming from the mobility of capital across borders and the monopsony power that the firms may possess in labour markets in developing countries. The organisations miss the global dimensions of such constraints.