DOES TRADE LIBERALIZATION EMPOWER WOMEN? EVIDENCE FROM EMPLOYMENT AND WAGE EFFECTS IN EXPORT INDUSTRIES

Abstract

Trade liberalization is widely promoted as a catalyst for economic growth and structural transformation in developing and emerging economies. However, its implications for gender equality and women’s economic empowerment remain uneven and highly context-dependent. This study examines whether trade liberalization empowers women through employment and wage outcomes in export-oriented industries, and how social norms influence these effects. Using a cross-country panel of 78 developing and emerging economies (2000–2020) and international labor statistics, we estimate the impact of trade openness on female employment shares and gender wage gaps, explicitly modeling social norms as a moderating factor.Results show that a 10 percentage point increase in trade openness is associated with a 12 percentage point increase in female employment shares in export industries in countries with less restrictive gender norms, but only a 4 percentage point increase in highly restrictive contexts. Gender wage gaps decrease by about 4 log points following trade liberalization in liberal normative environments but remain unchanged where norms are restrictive. These findings suggest trade reforms alone are insufficient for gender-equal outcomes; complementary institutions and policies are necessary.