Gender differentiated economic responses to crises in developing countries: insights for COVID-19 recovery policies
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Gender differentiated economic responses to crises in developing countries: insights for COVID-19 recovery policies Sandeep Mohapatra1
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Received: 27 July 2020 / Accepted: 28 September 2020 © Springer Science+Business Media, LLC, part of Springer Nature 2020
Abstract COVID-19 has wide-ranging and long-term implications for individual and household outcomes. Policymakers expect that the economic impact of COVID-19, channeled through labor markets, will disproportionately fall on women and girls, relative to men and boys. Surprisingly, little evidence exists for informing gender-sensitive COVID-19 recovery policies. This study examines the existence of genderdifferentiated dynamic responses of labor market and other household welfare outcomes to GDP contractions using historical country level panel data for South/ South-East Asia and West Africa. The econometric results reveal large gender differences in economic outcomes post crisis and provide insights for designing gender-sensitive COVID-19 recovery policies. Keywords COVID-19 Women Labor market Dynamic impact ●
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JEL Classification 01, 053, 055
1 Introduction Typically, an economic downturn or recession is caused by one of these three types of shocks: a demand shock (e.g., 9/11 event); a supply shock (e.g., 1990s oil price boom); or a financial market shock (e.g., 2008 crisis). COVID-19 brings all three shocks simultaneously (Triggs and Karas 2020): aggregate demand has shrunk as lockdown measures such as social distancing and business closures interrupt most forms of economic activity; supply disruptions have emerged due to travel restrictions and border closures particularly in the Asia Pacific region where global value chains
* Sandeep Mohapatra [email protected] 1
Department of REES, University of Alberta, Alberta, Canada
S. Mohapatra
Fig. 1 Global economic growth projections
are most concentrated (Abiad 2018); stock market volatility has increased in many countries along with macro- and micro- level liquidity crunches in financial markets. The economic-growth implications of these shocks are unprecedented. According to projections by the IMF, the global economy will contract by 3% in 2020 due to domestic demand and supply shocks and the rapid decline in the movement of goods, labor and capital. Recovery (Fig. 1) in 2021 is based on the assumption that COVID19 will fade away in the second half of 2020 and government policies will restore economic conditions to pre-crisis levels. Most countries individually are also projected to face GDP contractions in 2020 (e.g., U.S: −5.1%; Canada: −6.2%) with the engines of global growth, China and India, facing dramatic slowdowns (IMF 2020; OECD 2020a). The effects of the economic growth contractions are predicted to spill across product and factor markets including the entire food supply chain with significant long term effects on employment, income and poverty status of households (Triggs and Karas 2020). Arguably, the strongest impacts of COVID-19 will be felt in developing economies
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