The relationship between economic development and female labor force participation rate: A panel data analysis

Abstract

In economics, any production function is composed of capital labor and technology inputs. In the gross domestic product (gdp) growth of an economy labor seems to be an important input. Therefore, a country’s economic growth depends mainly on labor supply. In order to attain economic growth and development, an optimal choice of male and female labor force participation is necessary. Besides cultural and sociological factors, economic, education and health factors are the main issues affecting labor force participation in developing as well as developed countries. The objective of this chapter is to analyze the determinants of female labor force participation which are per capita gross domestic product, unemployment rate, ratio of female to male primary enrollment, ratio of female to male secondary enrollment, ratio of female to male tertiary enrollment, fertility rate and life expectancy of females at birth. The data used in this analysis belongs to World Bank database for G8 countries between 1995 and 2013. The results show that unemployment has a discouraging effect on female labor force participation rate. The gross domestic product and education are found to affect female labor force participation positively.