Inclusive Labor Markets and Poverty Reduction: An Empirical Analysis of South Asian Economies

Abstract

 Gender disparity in employment is one of the most serious and grim challenge of the modern world including south Asian countries. Although south Asian economies have taken significant leaps towards economic development in recent decades yet its economic, political and social institutions still remain one of the less developed in terms of providing decent opportunities for its people. Our paper focuses on the drivers of gender parity in employment for which the ratio of female to male labor force participation rate has been used as a proxy over the period 1995 to 2015 using panel data and the drive towards more inclusive labor market in order to eradicate widespread poverty in south Asian region. Our results suggests that the ratio of female to male labor force participation is positively associated with level of economic freedom index, democracy, ICTs infrastructure, trade openness, GDP per capita growth rate  and GDP per capita while democracy squared, quadratic GDP per capita and inflation tend to decrease gender equality in south Asian case. Although quadratic gdp per capita and quadratic democracy has negative impacts on the ratio, female to male employment policy recommendation has been proposed for making labor market flexible and inclusive. Our proposition is that in order to achieve inclusive growth and development more inclusive labor market institutions should be developed to alleviate poverty.