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Can Maquila Booms Reduce Poverty? Evidence from Honduras

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Author Info
de Hoyos, Rafael E. () (SEMS)
Bussolo, Maurizio () (The World Bank)
Nunez, Oscar (The World Bank)

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Abstract

This paper identifies and estimates the strength of the reduction in poverty linked to improved opportunities for women in the expanding maquila sector. A simulation exercise shows that, at a given point in time, poverty in Honduras would have been 1.5 percentage points higher had the maquila sector not existed. Of this increase in poverty, 0.35 percentage points is attributable to the wage premium paid to maquila workers, 0.1 percentage points to the wage premium received by women in the maquila sector, and 1 percentage point to employment creation. Given that female maquila workers represent only 1.1 percent of the active population in Honduras, this contribution to poverty reduction is significant.

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Publisher Info
Paper provided by The World Bank in its series Policy Research Working Paper Series with number 4789.

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Length: 23 pages
Date of creation: 01 Dec 2008
Date of revision:
Handle: RePEc:wbk:wbrwps:4789

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Related research
Keywords: Trade liberalization; maquila; poverty; gender wage gap; Honduras;

Find related papers by JEL classification:
F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
I32 - Health, Education, and Welfare - - Welfare and Poverty - - - Measurement and Analysis of Poverty
J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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This page was last updated on 2009-11-13.

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