Louise Fox, February 2016
Economic transformation is defined as the movement of resources (factors of production) to high productivity activities, both within and between sectors. It encompasses both the process of structural change (movement of resources between sectors) and within sector labour productivity improvements. Economic transformation is essential for improving the quality of growth.
However, economic transformation often leads to heterogeneous outcomes and unexpected consequences. Household outcomes depend on bargaining power within the household, and husbands and wives do not always maximize production. This means that policies that change the opportunities of women may affect bargaining power and through this channel, household outcomes. Women and men are heterogeneous, and how economic transformation affects women is mediated by socioeconomic differences and inequalities, such as spatial differences in livelihoods and opportunities, income differences among households, ethnic differences, and other socioeconomic cleavages.
This paper analyses whether a particular economic change associated with transformation is likely to bring more opportunities for women in low income countries, where the problem of economic transformation is most acute. Does a change have the potential to increase women’s income, power and agency, and effectiveness in their multiple roles? Under what circumstances? We consider how females might be affected by these changes in their roles as labourers, producers, consumers, mothers, children, and citizens.
Overall, the prospects for beneficial effects are good. However, as in other aspects of economic development, the extent of benefits for women depends on whether complementary policies are put in place to increase equality of opportunity. In some cases, potential policies are hard to identify, for example in the face of longstanding occupational segregation. In other cases, complementary policies are already part of development agendas, but they need to be implemented.