Economic Research Methodologies

I was shocked when I realized the greatest challenge to closing the economic gender gap in Africa. And I think it's important everyone learns about it as well. Here goes: The greatest challenge to closing the gender gap, and why it is estimated that it will take more than 150 years to close the gap in Africa, is the significant perception vs. reality gap. Let me explain: According to research by the Boston Consulting Group (BCG) & United Nations Global Compact, who surveyed 4000 men and women across Africa, they found that more than 50% of men and women in Sub-Saharan Africa believe that there is gender parity and/or women are ahead in their country when it comes to various indicators, including equal pay for work of equal value. Ironically, about 40% of the same men and women surveyed believe that men are better leaders than women in analytical and technical skills as well as leadership abilities. In reality however, even though women in Sub-Saharan Africa have higher rates of participation (54%) in the economy than global averages, 90% of them work informally, predominantly in low-skilled jobs, given their historical gap in access to education. They hold only nearly a quarter of management positions, with only 16% of CEO/MD positions held by women. And though this rate has been growing over the past 20 years, with the current rate, it is estimated that it will take more than 150 years to close the gender gap on the continent. So, the question now is what needs to be done? We all need to play our part in addressing the barriers that hold women back: - Every business needs policies against discrimination and harassment. - Flexible options like remote work and flexible hours are essential for working parents and women. - Training staff on gender equality and offering skills training for women are smart investments. - Programs such as financial literacy and business mentorship are crucial for female entrepreneurs and the self-employed. - Providing better access to financial products is vital for entrepreneurs and should be prioritized by banks and other businesses. - Equal pay and benefits, along with better parental leave and caregiving support, are important goals. Women's participation in the economy greatly boosts a country's productivity and can significantly increase GDP—by up to 50% in Africa—thanks to the added workforce and the benefits of gender diversity. The study authored by Qahir Dhanani and team (Sanda Ojiambo, Tolulope Lewis Tamoka, Lina Al Qaddoumi, Zineb Sqalli, Natasha Lendich, Maxime Kpangbai) also revealed a fascinating trend: women-led startups deliver a whopping 10% higher ROI. And that's not all! It also suggested that income earned by women has a significantly greater impact on communities compared to income earned by men. These findings highlight the incredible potential of bridging the economic gender gap.

Return-to-office mandates are increasing the gender pay gap and causing women to quit, take lower paying jobs, or drop out of the labor market Taylor Telford covers the growing pay gap and shift in women in the workforce by tapping research from prof. Mark Ma, Institute for Women's Policy Research, Flex Index and Census data: 🔴 Women are nearly 3X as likely to leave; people take lateral (41%) or lower-level jobs (46%) to gain flexibility. 🔴 It's not just women: turnover cranks up for more experienced and higher skilled workers; those with marketable skills go elsewhere. 🔴 Women now make 81 cents on the dollar, down from 84 cents in 2022 and lowest since 2016. 🔴 Increasing RTO demands: the Fortune 100 went from 16% to 29% demanding full-time in office over the last two years. "In 2023, Courtney Clements made a once-inconceivable career pivot: She took a roughly $30,000 pay cut, leaving a senior executive role after the commercial staffing firm where she worked began requiring employees to come into offices full-time." Prof Ma's research is based on 54 large technology and financial firms in the S&P 500 that implemented RTO mandates between 2020 and 2023. The results as the RTO mandates have gotten more strict and childcare costs risen have likely gotten worse, but so has the job market. Mary Beth Ferrante, of WRK/360 notes that now many women are “beholden to the situation they’re in” given the lousy job market, while others "have been forced to step back from their careers due to the paucity of affordable child care." Hence also our broader loss: a 3 percentage point drop in women's participation in the labor force. 👉 Read on: https://lnkd.in/g2dEGsX9 #GenderGap #RTO

Did you know Australian women just set a record?🏅 Women's labour force participation rate reached a new high of 63.5% in January 2025. That's a half-percentage-point jump from the previous month. Which is big in labour statistics land. It's this rise in women's labour force participation that drove the overall increase in the national rate (as men's participation rate fell slightly). Proof why it's important to always add a gender lens. January is the month where many new jobseekers and new hires are joining the labour market. As well as mothers who have been juggling summer holiday demands, and whose children will now be starting childcare or school, changing their working availability and preferences. Some will still be in the process of looking for opportunities and yet to be matched to a suitable job. This start-of-year job searching can help explain why the unemployment rate ticked up very slightly to 4.1% (again it was women's unemployment rate that drove the overall change, as men's rate was unchanged). Also today we found out Australia's latest gender pay gap, reported for November 2024. Men are earning on average $2073 in full-time weekly wages, compared to $1826 for women. That's a gap of $247 a week, tallying to around $12,800 a year. It equates to women earning 11.9% less than men on average, a gap which has widened since the last calculation (11.5% in May 2024). Men's earnings surged more rapidly than women's during this six-month period, particularly in sectors such as the Real Estate where jobs growth is strong. And partly the gender earnings gap reflects compositional changes. For example, between May and Nov 2024, we saw a notable expansion in women's employment in the Preschool and School Education sector. But because that's not a high-paying sector, it can dampen the calculation of women's overall average earnings. The Australian Government's legislated pay rise for Early Childhood Education and Care Workers came into effect in Dec 2024, so will be reflected in the next gender pay gap calculation. These numbers come fresh from the Australian Bureau of Statistics' Labour Force and Average Weekly Earnings datasets released yesterday. The takeaway from these numbers is that women's opportunities to join and stay in the paid workforce – and gain economic independence – continue to grow. Government policies, company initiatives, working-from-home and hybrid work, as well as the financial necessity of cost of living pressures, are all likely factors contributing to this record-breaking rise in women's workforce participation. But, we still need sustained and strengthened efforts to undo patterns of gender concentration, rectify the undervaluation of female-concentrated sectors, and unravel the biases and barriers that still underpin the gender pay gap. There are still more records to be broken. #genderpaygap #gendergap #genderlens #womenintheworkforce #genderequality #economics #labourmarket #ausecon

There's a lot of effort dedicated to increasing the proportion of women in men-dominated fields, but comparatively less effort dedicated to increasing the proportion of men in women-dominated fields. One explanation for men’s resistance to entering women-dominated fields has been that women-dominated fields tend to pay less than do men-dominated ones. In fact, some research suggests that as more women join a field, compensation goes down. New work by @Eileen Suh Evan Apfelbaum Michael Norton published in Organization Science finds that it isn’t lower pay per se that discourages men from going into women-dominated fields, but rather, concerns about status. That is, even if a women-dominated job paid as much as a men-dominated job, men would still avoid women-dominated jobs because they don't want to be seen as lower status. To demonstrate this effect, the researchers used the “results” of a career development inventory to justify identifying that the participant’s ideal job would be either a job that was stereotypically feminine (e.g., executive secretary) or stereotypically masculine (e.g., a computer systems administrator). Men were more likely to rate the feminine job as lower in status than the masculine job than were women. Men were therefore less interested in the assigned job, even though it was described as being ideal for them, given their answers on the career inventory. More compelling, the researchers identified two jobs that are not currently seen as inherently gendered – workplace productivity analyst or AI ethicist – and described them as being either feminine or masculine. They then again asked participants to complete the career inventory and reported that the analysis of their answers indicated that they would be a good fit for one of the two jobs. Men told that they would be well suited to a feminine job were significantly less interested in learning more about the job than when that same job was described to them as masculine. They also rated the feminine job as being lower status than the exact same job described as masculine. This difference did not manifest for women, who were equally interested in the job regardless of how it was described, and who also did not see status differences between the jobs based on their femininity or masculinity. If what we want, socially, is for men and women to be seen as equal in status, then we shouldn’t only be focusing on making higher status jobs – read: masculine jobs - more accessible to women. Rather, we need to also – or perhaps instead? – focus on making feminine jobs as high status as masculine jobs. And the present findings indicate that merely increasing pay for those jobs is not sufficient to address the status concerns that men have about taking feminine jobs; it is truly about the respect and esteem we hold for jobs like nursing, teaching, and other more communally-oriented careers.

Surveys suggest that fathers fear disadvantages in the labor market, which prevents them from taking parental leave. But is this fear justified? Find out in our new discussion paper "Parental Leave and Discrimination in the Labour Market" (joint with Julia S., Clara Welteke, and Doris Weichselbaumer): https://lnkd.in/ejBRKC7G Based on a large-scale field experiment, we analyze whether fathers and mothers face #discrimination in the hiring process based on their #parental leave in three different occupations. We find that: --> Fathers who took parental leave in a female-dominated or gender-neutral occupation are not less likely to be invited to a job interview compared to fathers who did not take leave. However, in the male-dominated occupation, fathers who have taken long (not short!) parental leave are penalized. --> There is clear evidence for strong #gender discrimination in hiring, irrespective of parental leave: Fathers are treated less favorably than mothers in the female-dominated and the gender-neutral occupation, while the opposite is true for the male-dominated occupation. --> This suggests the presence of strong gender norms concerning the perception of ideal employees in different occupations. Thus, although we find evidence of discrimination due to parental leave for fathers, discrimination due to gender is considerably higher and present in all three occupation types. Since gender discrimination often arises from social norms about gender roles in the family and the labor market, encouraging more fathers to take parental leave - and thereby "normalizing" their involvement in family care - could help reduce both discrimination against fathers who share caregiving responsibilities with their partners and gender discrimination in general. DIW Berlin - German Institute for Economic Research Berlin School of Economics University of Potsdam Johannes Kepler Universität Linz

The “raw” gender pay gap is 78.06%, and the “normalized” gap is 95.24% according to Pave data. Which gender gap benchmark should you be using? _____________ 𝗠𝗲𝘁𝗵𝗼𝗱𝗼𝗹𝗼𝗴𝘆 𝗔: 𝘁𝗵𝗲 “𝗿𝗮𝘄” 𝗴𝗲𝗻𝗱𝗲𝗿 𝗽𝗮𝘆 𝗴𝗮𝗽 The “raw” gender pay gap is the benchmark you are likely already familiar with. When you read about the gender pay gap for salaries in the news, it almost always refers to this “raw” pay gap. In other words, take the average salary for employees who identify as women in a population and compare it to men in that same population. This “raw” pay gap is also the basis of Europe’s DEI reporting requirements. 🚨 “Raw” gender salary gap in Pave’s dataset for USA employees => 78.06% In other words, on average, employees in Pave’s dataset identifying as women make 21.94% less than the employees identifying as men. _____________ 𝗠𝗲𝘁𝗵𝗼𝗱𝗼𝗹𝗼𝗴𝘆 𝗕: 𝘁𝗵𝗲 “𝗻𝗼𝗿𝗺𝗮𝗹𝗶𝘇𝗲𝗱” 𝗴𝗲𝗻𝗱𝗲𝗿 𝗽𝗮𝘆 𝗴𝗮𝗽 Our team dug one level deeper and looked at the gender pay gap normalized by level and job family. Simply put, what does the median women-identifying employee make requisite with her male counterpart in the same job family, job level, and country (USA). 🚨 “Normalized” gender salary gap in Pave’s dataset for USA employees => 95.24% In other words, if you compare two employees with the same job family and job level, there will be, on average, a 4.74% difference in salary between the men and women. 4.74% is certainly not 0%, but it is a lot smaller than the 21.94% delta in the “raw” gender salary gap benchmark mentioned above. 𝗧𝗵𝗲 𝗯𝗶𝗴𝗴𝗲𝘀𝘁 𝘂𝗻𝗱𝗲𝗿𝗹𝘆𝗶𝗻𝗴 𝗶𝘀𝘀𝘂𝗲 𝗶𝘀 𝗿𝗲𝗽𝗿𝗲𝘀𝗲𝗻𝘁𝗮𝘁𝗶𝗼𝗻 𝗮𝘁 𝗵𝗶𝗴𝗵𝗲𝗿 𝗽𝗮𝘆𝗶𝗻𝗴 𝗹𝗲𝘃𝗲𝗹𝘀/𝗳𝘂𝗻𝗰𝘁𝗶𝗼𝗻𝘀 𝗿𝗮𝘁𝗵𝗲𝗿 𝘁𝗵𝗮𝗻 𝗱𝗶𝘀𝗽𝗮𝗿𝗶𝘁𝘆 𝗮𝘁 𝘁𝗵𝗲 𝘀𝗮𝗺𝗲 𝗹𝗲𝘃𝗲𝗹/𝗳𝘂𝗻𝗰𝘁𝗶𝗼𝗻. _____________ Takeaways: 1️⃣ The massive (~5x) delta between the “raw” and “normalized” gender pay gap is largely driven by much higher representation of men in higher levels and higher compensated job families. For instance, only 20% of C-level employees (E9) in Pave’s dataset identify as women per the second attached chart. 2️⃣ European DEI reporting requirements center around the “raw” rather than the “normalized” gender pay gap. There are pros and cons to Europe’s emphasis on the “raw” rather than “normalized” pay gap. For instance, we hosted 11 customers at our office yesterday and talked about how Europe's emphasis on the “raw” gender pay gap perhaps oversimplifies the matter. That said, a European regulator likely responds “okay, well then just hire more women CXOs” to the company who complains about the oversimplification. My two cents–aside from what the reporting requirements are region-by-region, I would argue that both gender gap measurements–”raw” and “normalized”--are important measures to keep in mind. Go deep and understand the “why” behind both figures and use it to inform your decision marking. #pave #genderpaygap #benchmarks

The Role of Women as Major Contributors of Tax Revenue in the Ghanaian Informal Sector   In line with our Women Empowerment series, I had an opportunity to discuss this topic with one of the media houses for this years’ International Women’s Day Celebration. It’s intriguing to note that Women make up a large portion of informal sector workers, especially in Accra, Ghana. Studies[1] have shown that around 74% of informal sector activities are undertaken by women. The 2020 Mastercard Index of Women Entrepreneurs (MIWE) ranked Ghana as the 3rd with Uganda and Botswana placing 1st and 2nd respectively as countries with the most women business owners globally. Women therefore play a crucial role in the Ghanaian informal sector, often engaging in small-scale businesses that contribute significantly to their families' livelihoods and the national economy. Women in Ghana therefore play a pivotal role in bolstering the informal sector, which significantly contributes to the nation's tax revenue below are some areas, not exhaustive though: 1. E-levy (1% of value electronic transactions) Most women within the informal sector do not necessarily operate bank accounts with the financial institutions. For such women, they resort to mobile money platforms for their transactions. The implementation of the E-Levy, which imposes a 1% charge on electronic transactions, means that these women will be paying e-levy on such mobile money transactions. Given the high volume of mobile money transfers conducted by women entrepreneurs, their contributions to tax through e-levy payment will be high. 2. General contribution of the informal sector to tax As indicated, women undertake about 74% of informal sector players. Given these statistics, it suggests that women will contribute a lot more of the tax generated by the government from the informal sector generally, all things being equal. Thus, the contribution of women to government’s tax revenue from the informal sector cannot be discounted. 3. Contribution to import taxes and levies Import taxes and levies are major contributors to government’s tax revenue. For some of the players within the informal sector, the goods (hair, skin products etc.) they deal in are mainly imported. At the point of entry into the country, they pay import duties and taxes. Through this, the women contribute to government’s tax revenue. Empowering women is not only a moral imperative but also a strategic imperative for driving economic growth and prosperity in Ghana. By investing in women's education, health, etc. Ghana can unlock the full potential of its female population and harness the benefits of inclusive economic development. #womenintax #empoweringwomen

Greedy jobs - women’s inequality - Nobel prize : An appeal to those with the power to shape job specs. Greedy jobs are those that require long and inflexible hours, often in exchange for high pay and career advancement. Examples of greedy jobs include law, finance, consulting, tech, and medicine. These jobs tend to reward those who work more hours and are willing to drop things to get the job done. Late nights , immediate availability, long hours, travel . They penalize those who work less, creating a trade-off between work and family. One of the most demanding and underappreciated jobs in society is motherhood. Mothers are expected to provide constant care and support for their children, often without adequate compensation or recognition. Motherhood is a greedy job because it consumes a large amount of time and energy, leaving little room for other activities. Mothers also face discrimination and stigma in the labour market, as employers may perceive them as less committed or productive than their childless counterparts. The gender gap in earnings and opportunities is partly explained by the clash between greedy jobs and motherhood. Many women who aspire to have both a career and a family find themselves in a difficult situation, where they have to choose between sacrificing their professional goals or their personal happiness. Some women may opt out of the labour force entirely or work part-time, while others may delay or forego having children. These choices have long-term consequences for women's economic well-being and social status. This year's Nobel Prize in Economics was awarded to the American economist Claudia Goldin. As Professor Goldin is being honoured for her ground-breaking work on women in the labour market, Professor Goldin's research notably sheds light on how motherhood contributes to the gender pay gap. To close the gender gap and improve the well-being of both men and women, we need to rethink how we design and value work. We need to make jobs less greedy by reducing the penalties for working fewer hours, increasing the flexibility of schedules, and promoting a culture of work-life balance. We also need to make motherhood less greedy by providing more support and resources for parents, such as affordable childcare, paid leave, and flexible work arrangements. By doing so, we can create a more inclusive and equitable society for everyone.

Pricing of Weather Derivatives Using Monte Carlo Simulations Weather derivatives are a particular class of financial instruments that individuals or companies can use in support of risk management in relation to unpredictable or adverse weather conditions. There is no standard model for valuing weather derivatives similar to the Black–Scholes formula. This is primarily due to the non-tradeable nature of the underlying asset, which violates several assumptions of the Black–Scholes model. The paper presents a valuation method for pricing an exotic wind power option using Monte Carlo simulations. - Wind power generators are exposed to risks stemming from fluctuations in market prices and variability in power production, primarily influenced by their dependency on wind speed. - The research focuses on designing and pricing an up-and-in European wind put barrier option using Monte Carlo simulation. - In the presence of a structured weather market, wind producers can mitigate fluctuations by purchasing this option, thereby safeguarding their investments and optimizing profits. - The wind speed index serves as the underlying asset for the barrier option, effectively capturing the risks associated with wind power generation. - Autoregressive Fractionally Integrated Moving Average (ARFIMA) is utilized to model wind speed dynamics. - The study applies this methodology within the Colombian electricity market context, which is vulnerable to phenomena like El Niño. - During El Niño events, wind generators find it advantageous to sell energy to the system because their costs, including the put option, are lower than prevailing power prices. - The research aims to advocate for policy initiatives promoting renewable energy sources and the establishment of a financial market for trading options, thereby enhancing resilience against climate-induced uncertainties in the electrical grid. Reference: Y.E. Rodríguez, M.A. Pérez-Uribe, J. Contreras, Wind Put Barrier Options Pricing Based on the Nordix Index, Energies 2021, 14, 1177 #derivatives #riskmanagement #econometrics #forecasting

Just after International Women's Day, the March Research Insights from The World Bank's World Bank Development Economics focus on more and better jobs for women. They highlight four recent research papers: 👩🏫 Megan Lang and Julia Seither find that a skills-based program in rural Uganda, which focused on business planning, record-keeping, and soft skills, increased women's likelihood of generating income from their own businesses by 17% after 18 months, helping them reinvest in their enterprises and maintain stable revenues during the COVID-19 lockdown. 💡 These findings highlight skills-based programs as an effective strategy for enhancing women’s economic participation and ability to withstand financial shocks. https://lnkd.in/g3Gyixmd 👷♀️ Florencia Devoto, Emanuela Galasso, Kathleen Beegle, and Dr. Stefanie Brodmann show that a public works program in urban Djibouti, designed to facilitate women's access to employment through job proximity, high wages, and flexible work arrangements, achieved a 77% take-up rate among eligible women but did not lead to sustained employment after the program ended. 📌 This underscores the need for policies that extend beyond short-term employment by expanding access to sustained job opportunities, addressing structural labor market constraints, and creating an enabling environment for women’s workforce participation. https://lnkd.in/gCXRNizF 🏠 Ivette Contreras, Lelys Dinarte, Amparo Palacios Lopez, Valentina Costa, and Steffanny Romero Esteban find that a survey experiment in El Salvador found that including a module with a list of activities in household surveys increased reported employment for women by 8.1 percentage points, as it helped them identify informal activities like preparing food or helping in a family-owned business as work, which are often underestimated in standard surveys. 📍 In low- and middle-income countries, where informal work is prevalent and employment gaps between women and men are significant, refining labor data collection is essential to designing and targeting interventions that help women and youth access better job opportunities.  https://lnkd.in/gtxJEDET 🕌 Federico Fiuratti, Steven Pennings, and Jesica Torres estimate that gender employment gaps in the Middle East and North Africa (MENA) could significantly boost GDP per capita, with long-term gains averaging 50% across the region, though these gains vary widely by country and are expected to be smaller in the medium term due to slow physical capital adjustment. 🧷 This underscores the importance of reforms to facilitate female employment to accelerate economic growth in MENA, particularly in countries with the largest gender gaps. https://lnkd.in/gA5wYYER The Research Insights are available here: https://lnkd.in/geXYnXEZ