Determinants of women’s labor force participation and economic empowerment in Albania Juna Miluka University of New York Tirana September, 14, 2015

Outline Background and motivation Purpose Data Descriptive statistics Econometric Model Results Conclusions and policy recommendations

Background and motivation Economic development and female labor force participation Central stage in European country – Lower FLFP – Old age feminization of poverty – Population decline – Reduced fertility – International out-migration – Lower LS Developing country evidence – Transitional period – Economic growth – Poverty reduction

Background and motivation Lack of empirical evidence for Albania Women’s position in labor market – Significance for poverty – Old age pensions – EU integration Urban-rural difference – Men vs. Women – Urban women vs. Rural women

Purpose Estimating determinants of female labor force participation Urban-rural differences Impact of female labor force participation on secondary school enrollment

Data 2008 Living Standard Measurement Survey INSTAT and World Bank Household and individual level data Total Sample: 3,600 households Final Sample: ages – 9,143 individuals – 4,390 males – 4,753 females

Descriptive Statistics Source: INSTAT, LFS.

Descriptive Statistics Source: INSTAT, LFS.

Descriptive Statistics Source: INSTAT, LFS.

Econometric Model Labor force participation Probit Model y* n = x n β+ ε n (1) y n = 1 if y* n ≥ 0 (2) y n = 0 otherwise (3) Variables – Female labor force participation – Education – Experience – Male and female labor – Number of children under the age of 6 – Marital status – Social capital – Distance – Household with permanent migrants – Land area and number of plots – Regional dummies

Econometric Model Secondary school enrollment Male and female ages – Household female labor force participation – Log household size – Log total consumption – Head’s education – Distance index – Regional dummies

Results Labor Force Participation Urban-rural differences – Education strong in urban; weak in rural – Experience very strong for both areas – Male/female labor complements in urban areas; no impact in rural areas – Negative impact of children overall and especially in rural areas – Negative impact of marriage on urban women

Results – Positive impact of international migration overall, but not regionally – Negative impact of distance in rural areas – Mountainous rural areas most problematic

Results Secondary School Enrollment Strong positive impact of female labor force participation Captures parent’s expectations of labor market Larger impact for females Largest impact for rural females

Conclusions and Policy Recommendations Role of education, uninterrupted work experience, social support and infrastructure Virtuous circle in urban areas – education – skills – rewards in labor market Restructuring of labor market in rural areas – Rural non-farm activities

Conclusions and Policy Recommendations Education and vocational training – Role of National Employment Services Improved infrastructure and public services – Infrastructure and non-farm entrepreneurial activities Social assistance for women with many children – Day care and day care at work Work-family reconciliation policies – Reduce employer’s bias against women’s family responsibilities