The effect of female employment on saving-investment gap and the role of their interaction in the economic growth

Oznur Ozdamar, Sibel Gunduz and Eleftherios Giovanis ()

International Journal of Computational Economics and Econometrics, 2022, vol. 12, issue 3, 241-262

Abstract: A large number of countries experience negative saving-investment (S-I) gaps, which can be detrimental to economic growth. Earlier literature indicates that women save more than their male counterparts. In this study, our preliminary aim is to understand, whether female employment rates increase domestic savings that could potentially contribute positively to the S-I gaps in the low and middle-income countries. Second, we aim to investigate whether the interaction of female employment rates and S-I gap matters for economic growth. The entire analysis relies on panel data from 74 low and middle-income countries over the period 2000-2017. Various panel data techniques are applied, and they reveal similar results. The main finding of the study shows that low levels of female employment rate, and therefore inferior female earnings, are obstacles to an adequate amount of savings accumulation, necessary to close the savings-investment gap and thus, to enhance economic growth.

Keywords: developing economies; economic growth; female employment rate; gender roles; gender inequalities; gender-wage gap; low and middle income countries; panel cross-section dependence test; panel data analysis; saving-investment gap; social norms; unit root tests. (search for similar items in EconPapers)
Date: 2022
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Persistent link: https://EconPapers.repec.org/RePEc:ids:ijcome:v:12:y:2022:i:3:p:241-262

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