Explaining the Gender-Gap in Economic Activity: A Cross-Country Study

Abstract

This study aims at investigating the cross-country variation in gender-gap in economic activity. A balanced panel data for 72 countries with complete data for the period 2000-2016 were extracted from the World Bank indicators. The statistical diagnostic tests supported the use of the fixed effect model. The series was stationary at level and not co-integrated. Moreover, the null hypothesis of the appropriateness of random effect model was rejected. The estimated results assure the importance of demand side factors in dampen the gender gap in economic activity as expected such as GDP growth, gender gaps in employment, in being self-employed and unemployment, urbanization and trade openness. Surprisingly, the supply side factors such the cross-country variation in gender gap in education and fertility rates were no more important determinants in explaining the gender gap in economic activity. This study recommends governments to improve the demand-side factors that would encourage more female employment and reduce the gender gap in economic activity later.