Repelling Rape: FDI Empowers Women

Li T, Pandya S, Sekhri S. Repelling Rape: FDI Empowers Women. Working Paper.

NOTES

What improves women' s status and reduces rape? Washington Post/Monkey Cage April 30, 2020.

Abstract

Can global economic integration dismantle social exclusion? Integration can create new economic opportunities for marginalized social groups, but may also trigger backlash by dominant groups that reinforces exclusion. The net effect of these opposing mechanisms is unclear. We argue that foreign direct investment (FDI) produces women’s empowerment that is resilient to male backlash because it exposes women to gender equality norms. We leverage India’s 2005 FDI liberalization to identify FDI’s causal effect on women’s empowerment and rape, a violent manifestation of backlash. In FDI-exposed districts, rape declined, women’s relative wage growth doubled, and women voiced stronger support for women’s empowerment. In exposed districts women exercised household bargaining leverage and political participation in ways that increase women’s safety and deter rape. Gender equality norms are essential. FDI from low gender equality countries, which raises in- come but lacks equality norms, increases rape. We rule out several alternative mechanisms. Our findings establish a new channel through which economic integration advances social equality.

Last updated on 12/09/2022