The growth effects of the socio-economic status of women in developing countries: A panel data VAR approach

This dissertation investigates the empirical relationship among four major indicators of the socio-economic status of women in developing countries and how these measures have affected their reproductive behavior as well as the economic performance of these countries, during the period from 1960 to 2000. In a departure from conventional practice, this study analyzes the relationship among these variables in a PVAR framework; a technique which takes into account the potential endogeneity of these variables, which are often assumed to be exogenous in typical cross-country econometric methods. Analyzing this relationship in a PVAR framework creates the possibility to conduct this research in an environment where the potential feedback effects which may exist among the variables of interest, are properly accounted for. The results indicate that the average number of children a woman bears in her lifetime seems to have a two-way negative relationship with all other variables in the model. That is, a decrease in the growth rate of fertility, increases the labor force participation of women, raises the average number of years of female education, and promotes the growth rate of GDP per capita. In return, all these variables have a diminishing effect on the growth rate of fertility. Moreover, there also appears to be a positive feedback loop between the growth rate of GDP per capita, female employment, and the growth rate of female schooling. However, the study does not find any evidence to support the notion that an increase in female education will increase the labor force participation of women. The bi-directional relationship observed between most of the variables in the system has important policy implications. Particularly, this econometric methodology presents policy-makers with a variety of policy options in dealing with issues related to female education, female employment and fertility. For example, if the desired policy objective is raising the average level of female educational attainment, policy planners would know that policy-induced changes in education promotes as virtuous cycle of cumulative causation in which other variables like fertility and employment can interact with female education to in a mutually reinforcing way.