Numerous studies point to a strong correlation between gender equality in developing countries and economic growth. Call it the female dividend: Money that finds its way into a mother’s purse is more beneficial to families and communities than the cash funneled into a male wallet.
Research by investment bank Goldman Sachs found that women tend to invest their income in their children’s health, education and clothing. Men, the bank found, usually preferred to spend it on themselves, buying cigarettes, alcohol or what it delicately terms “female companionship.”
Offering women more opportunity to earn a living could, Goldman Sachs said, push up income per head by 20 percent more than previous predictions in a clutch of emerging economies over the next two decades.
Its view is supported by other research: The World Bank says that the gender divide has imposed huge economic costs throughout the Middle East, where the gap in economic opportunity is the widest in the world.
The message is clear: Countries that deny fair opportunities to women are hampering their potential for development and growth. The struggles of a female subsistence farmer in Africa seem remote from our lives in the West, but empowering women in the developing world is in our interest. Societies where women are treated well are more likely to be peaceful and prosperous and, as growth slows in mature markets such as the UK, female consumers could play an increasing role in a new global middle class, which will open up opportunities for businesses everywhere to sell their goods and services.
Despite the continued debates about the under-representation of women on boards and the difficulties experienced by working mothers, developed economies like ours have already benefited from greater equality. As Cambridge economist Ha-Joon Chang says in his book 23 Things They Don’t Tell You About Capitalism, the washing machine may have changed the world more than the Internet has, because it freed legions of women to work outside the home.
Part of the reason we are blinkered about the struggles of women in poorer countries is that in the rich West, many battles have been won. We are fortunate in having access to education and employment that our great-grandmothers could only have dreamed about. Even the West, though, improving opportunities for women to work, and to progress up the career ladder if they wish, could boost productivity and growth. More female workers could even help head off the pensions crisis and the problems of an aging population.
The single biggest factor in the success of any business, or nation, is its human capital — the flair, talent and productivity of its workers. Women represent half of the world’s human capital and could be a powerful force for economic growth — perhaps even the most powerful force there is. They are being held back by a machismo founded on the fear that empowering women is somehow disempowering men. However, prosperity is not a zero-sum game: If a society cashes in on the female dividend to create more wealth, men and children share in the bounty. Everyone wins.
Healthy cultures respect women’s role in binding families and communities. Where they are condemned to subordinate status, subjected to violence, deprived of an education and debarred from earning a decent livelihood, those families and communities will unravel. Striving for equality is not just a matter of fairness — it is clever politics, clever diplomacy and clever economics.
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