Export and gender difference in production contribution: A joint and non-linear analysis using panel and firm-level data

Trade liberalization has been widely recognized to have a profound influence on the labor market, especially in developing countries. Amid the transformation of gender roles, the improvement of female workers’ welfare has received increasing attention. In such studies, the gender wage gap generally is the focus, and the residual wage gap is commonly used to measure discrimination. However, this paper empirically examines gender differences in workers’ contributions to production through labor efficiency and productivity, which are defined separately. We use panel data on Chilean manufacturing firms from 2001 to 2007. Non-linear estimations are conducted to determine the gender differences in these firms. We first decompose male and female labor efficiency based on a traditional Cobb-Douglas production function. Next, we extend the Cobb-Douglas function and use a semi-parametric method to remove endogeneity and reduce bias estimation. We then also decompose female and male workers’ contributions to productivity. The results show that, among domestic firms which do not export, female workers contribute significantly lower efficiency and productivity than male workers. Among firms which participate in the exporting market, the differences in the efficiency and productivity of female and male workers are insignificant. Therefore, gender production differences are found to be significant in domestic but not exporting firms. Besides the firms’ exporting status, we also estimate the impact of capital ownership and exporting revenue on gender as alternative robustness tests. The findings remain consistent. Firms which do not adopt foreign capital, or operating exclusively in the domestic market, have significant, unequal distributions of labor efficiency and productivity between female and male workers. Firms which are actively involved in foreign markets have insignificantly gender differences. Therefore, export-market participation indeed reduces gender differences and guarantees similar contributions by female and male employees. High productivity, advanced managerial philosophy, and capability to compete globally all encourage a firm to export, and to equalize the treatment and contribution of male and female employees as well.