Gender inequality and economic development: fertility, education and norms

We document the evolution of gender inequality in labour market outcomes—earnings, labour supply and wage rates—over the path of economic development, and present evidence on the potential reasons for this evolution. To this end, we have created a micro database that compiles 248 surveys from 53 countries between 1967 and 2014, covering a wide range of per capita income levels. There is large convergence in the earnings of men and women over the path of development, driven by female labour force participation and wage rates. We argue that the single most important factor behind this convergence is demographic transition: the effects of children on gender gaps (‘child penalties’) are large at both low and high levels of development, but fertility declines drastically over the growth process and thus reduces the aggregate implications of children. We also document gender convergence in educational attainment and consider its effects on earnings inequality, arguing that these are significant but less dramatic than the effects of fertility. Finally, we document striking changes in the values or norms surrounding the role of women with children, implying that such changes could serve as a reinforcing mechanism for gender convergence.