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Services Trade: The Great Gender Equaliser?

Author

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  • Louise Johannesson
  • Hildegunn Kyvik NordÃ¥s

Abstract

Standing at 24% in 2018, India’s female labour force participation is only half of the global average (48%). At the same time, India has one of the widest gender wage gaps in the world and women are less likely to be employed in the formal sector compared to men. This article focuses on how international trade affects relative wages and formal employment between men and women in India. Using the Revealed Symmetrical Comparative Advantage index, sectors of comparative advantage and disadvantage are identified and matched to Indian labour force surveys that contain information on sectoral employment and earnings. We find that sectors of comparative advantage in services have the lowest gender wage gap, with women earning 24% less than their male counterparts, while women in manufacturing earned on average 40% less than male workers. Using the Oaxaca–Blinder decomposition, we find that the total gender wage gap in sectors of comparative advantage in services are minor while it is quite substantial in manufacturing, regardless of comparative advantage status. The article concludes that services trade goes hand in hand with a smaller gender wage gap as women leverage their skills better in services than in manufacturing. JEL Codes: F16, F14

Suggested Citation

  • Louise Johannesson & Hildegunn Kyvik NordÃ¥s, 2021. "Services Trade: The Great Gender Equaliser?," Foreign Trade Review, , vol. 56(3), pages 341-363, August.
    • Handle: RePEc:sae:fortra:v:56:y:2021:i:3:p:341-363
    DOI: 10.1177/00157325211011845
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    References listed on IDEAS

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    More about this item

    Keywords

    Gender; services trade; jobs; earnings;
    All these keywords.

    JEL classification:

    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade

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