Panel Analysis of Female Labor Force Participation and Income Distribution in 136 Countries
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Abstract
The study questions whether the female labor force participation ratio (FLFP) explains income distribution. Panel data analysis uses an unbalanced panel of 136 countries from 1990 to 2020. The study uses eight different panels based on development status and region. The econometric model uses two-way fixed effects with Driscoll and Kraay standard errors. The study finds that the FLFP improves income distribution in most cases. The study finds that higher FLFP can worsen income distribution in only two instances. The study also finds that democratization increases the percentage of women in government, improving income distribution through promoting FLFP. Finally, FLFP improves income distribution at the labor market and after-tax and redistribution levels in most cases.