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Land market restrictions, women's labor force participation, and wages in a rural economy

M. Shahe Emran, Forhad J. Shilpi, M. Shahe Emran and Forhad J. Shilpi
Authors registered in the RePEc Author Service: M. Shahe Emran () and Forhad Shilpi

No 7524, Policy Research Working Paper Series from The World Bank

Abstract: This paper analyzes the effects of land market restrictions on the rural labor market outcomes for women. The existing literature emphasizes two mechanisms through which land restrictions can affect the economic outcomes: the collateral value of land, and (in) security of property rights. Analysis of this paper focuses on an alternative mechanism where land restrictions increase costs of migration out of villages. The testable prediction of collateral effect is that both wages and labor force participation move in the same direction, and insecurity of property rights reduces labor force participation and increases wages. In contrast, if land restrictions work primarily through higher migration costs, labor force participation increases, while wages decline. For identification, this paper exploits a natural experiment in Sri Lanka where historical malaria played a unique role in land policy. This paper provides robust evidence of a positive effect of land restrictions on women's labor force participation, but a negative effect on female wages. The empirical results thus contradict a collateral or insecure property rights effect, but support migration costs as the primary mechanism.

Keywords: Communicable Diseases; Cholera; Leprosy; Malaria; Labor Markets; Rural Labor Markets; Regulatory Regimes; Legislation; Legal Reform; Judicial System Reform; Social Policy; Common Property Resource Development; Legal Products; Educational Sciences (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-agr
Date: 2015-12-22
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Journal Article: Land Market Restrictions, Women's Labour Force Participation and Wages in a Rural Economy (2017) Downloads
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