Gender discrimination can be see in a number of ways, and often times these social barriers lead to market failures. Gender inequality in education has been shown to stunt economic growth and development. A recent article in the Economist provides empirical findings from Britain’s Department of International Development that show that an increase in enrollment for women in education caused and increase in annual income per head. Björkman-Nyqvist claims that in times of economic hardship, girls are more likely to be removed from schooling than boys. The author uses evidence from Uganda showing a relationship between average rainfall and school enrollment across genders. The paper concludes that a 15% reduction in rainfall will cause a 5% decrease in enrollment rates for women, while men are insignificantly effected. This carries some implications with it. Being that 80% of Uganda’s workforce is in agriculture, droughts can make the difference between sending children to school or to work.
Parents could be looking at the short term personal gains, rather than the long term social optimum. Men make more money in the job market than women. Parents are incentivized to keep boys in school since boys receive a higher marginal benefit from education. However, having women enter the market could increase competition in the labor force. The effects of learning by doing would occur faster as the demand for jobs rises, increasing productivity. While in theory this may reduce wages, that would only be in the case in places where jobs are scarce and workers would be willing to offer their services at a lower than the equilibrium wage. In contrast, this is not seen in African countries as a 1% increase in secondary school enrollment causes a 0.3% increase in annual income per capital. This gives evidence that wages cannot be going down since income depends on wage. The effects span beyond just women. A greater social benefit is received from increasing access to school across genders than the personal profits received. Due to the prevalence of poverty in the developing world, the difficulty lies in parents feeling that they must pick a winner in the family to send to school. The budget constraint of families does not always allow for every child to go to school. The benefits are clear, but the choices are difficult.
Creating opportunities for women in education could be a big step towards equality, and a small step towards economic stimulus. Increasing education levels for women causes a rise in the income of all individuals in that country. In the developing world, it is difficult to measure ways and means of stimulating economic growth and development. Lowering these gender barriers that restrict women from receiving education should be eliminated so that the social optimum may be reached. But many overlook the benefits of women becoming more affluent. The prevalence of these issues had encouraged the UN to make eliminating gender disparity in education a part of its Millennium Development Goals. This and other movements towards equality will generate economic growth and development. The disparity in gender inequality has more costs that can be seen at first glace.