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Quota removal, gender-specific export shock, and female labor force participation in China

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  • Wang, Lixia
  • Liu, Haiyun

Abstract

There is a lack of consensus on how trade liberalization affects female labor force participation (FLFP), primarily due to challenges in identifying exports of female labor-intensive products. In this study, we construct a unique gender-specific export shock by examining the removal of the Multi-Fiber Arrangement (MFA) trade quotas in 2005, which targeted the female labor-intensive textiles and clothing (T&C) industry. Using a difference-in-differences (DID) approach, we find that MFA quota removal significantly increases FLFP in China, which is attributed to the heightened demand for female labor in the T&C industry and related services. Increased demand not only boosts women incomes but also significantly reduces fertility rates. Furthermore, it disproportionately benefits four specific female groups: well-educated women, young women, unmarried women, and those without young children.

Suggested Citation

  • Wang, Lixia & Liu, Haiyun, 2024. "Quota removal, gender-specific export shock, and female labor force participation in China," Economic Modelling, Elsevier, vol. 139(C).
    • Handle: RePEc:eee:ecmode:v:139:y:2024:i:c:s0264999324001780
    DOI: 10.1016/j.econmod.2024.106821
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    More about this item

    Keywords

    Quota removal; Female labor force participation; Gender-specific export; Trade liberalization; China;
    All these keywords.

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure

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