This indicator measures the government’s commitment to promoting gender equality by providing women and men with the same legal ability to access legal and public institutions, own property, go to court, and get a job; and measures the extent to which the law provides girls and women legal protection from violence. It draws from two sources, the World Bank’s Women Business and the Law (WBL) Index and data from UCLA’s WORLD Policy Analysis Center data on Child Marriage and Customary Law.
Relationship to Growth & Poverty Reduction
This indicator draws on all eight areas of the Women Business and the Law (WBL)report including:Mobility, Workplace, Pay, Parenthood, Marriage, Entrepreneurship, Assets and Pensions. It also draws from UCLA’s data on Child Marriage and Customary Law.
- Mobility (WBL): These questions explore women’s legal access to physical mobility within a country. Studies show that legally sanctioned gender inequality has a significant negative impact on a country’s economic growth, because it prevents a large portion the population from fully participating in the economy, thus lowering the average ability of the workforce. 1
- Workplace (WBL): These questions explore specific barriers to women’s opportunities in the workplace. Sexual harassment and violence in the workplace can undermine women’s economic empowerment by preventing employment and blocking access to other financial resources. 2 Research shows that when women have access to employment, investment in children’s health, nutrition, and education often increases, promoting higher levels of human capital. 3
- Pay (WBL): These questions look at barriers to women’s pay equality. Restrictions on working hours, sectors, and occupations limit the range of jobs that women can hold and this lead to occupational segregation and confinement of women to low-paying sectors and activities. 4 Many jobs prohibited for women are in highly paid industries, which can have implications for their earning potential. Further, when women are excluded from “male” jobs in the formal sector, an overcrowding can occur in the “female” informal job sector. This leads to a depression of wages for an otherwise productive group of workers. 5 Increasing women’s participation in the workforce alone is insufficient for increased economic growth. 6 Women need access to the same job and pay opportunities in order to have an impact on economic growth. 7
- Marriage (WBL): These questions look at women’s equality in marriage including questions on domestic violence, and child marriage. Research shows the earnings of women in formal wage work who are exposed to severe partner violence are significantly lower than women who do not experience such violence. 8
- Parenthood (WBL): These questions look at the availability and equality of paid parental leave and the rights of pregnant women. Childcare and paid parental leave increase workforce participation and pay equality, leading to poverty reduction and increased economic growth. 9
- Entrepreneurship (WBL): This area explores barriers to women’s ability to start businesses. When one gender receives fewer legal rights, both the country’s potential labor force and potential pool of entrepreneurs decreases. Women’s ability to start businesses and create jobs is essential to increase economic growth and alleviate poverty. 10
- Assets (WBL): This area analyzes women’s ability to own, control, and inherit property. Owning and having an equal say in their use of property not only increases women’s financial security; it is also associated with their increased bargaining power within the household. 11
- Pension (WBL): This area examines questions of whether men and women have the same rights with respect to pensions, retirement, retirement age, and periods of absence from the workforce due to childcare. Pension equality has been shown to reduce poverty, particularly for older women. 12
- Child Marriage and Customary/Religious Law (WORLD Policy Analysis Center): This area deals with women’s constitutional rights, and the status of Child Marriage. Due to the typically large age differences between girls younger than 18 and their husbands, child brides lack bargaining power in the marriage and have less say over their activities and choices, including education and economic activity. 13 Child marriage–through reduced decision-making power, greater likelihood of school dropout and illiteracy, lower labor force participation and earnings, and less control over productive household assets—severely impedes the economic opportunities of young women. 14 For many women in rural areas, customary and religious law can override constitutional protections for equality and legal rights. 15 Where these laws can override constitutional protections, all of the other benefits to economic growth and poverty reduction provided by other concepts covered in this indicator are nullified. 16
Both indicators are de jure measures, consisting in legal reviews of the questions assessed.
The WBL portion of this indicator utilizes the WBL index comprised of 35 questions from the Women, Business, and the Law initiative of the World Bank. These questions are divided into 8 categories, each of which receives a score based on the percentage of questions with no restrictions on women’s rights (so a country where women have 3 of the 5 rights measured in a category, would score 60 for that category (because 3 is 60% of 5)). Finally, the scores for all 8 categories are averaged together to create the index.
The WORLD Policy Analysis Center portion of this indicator uses 5 questions from the WORLD Assessment areas on Constitutions and Child Marriage. Specifically:
- What is the minimum age of marriage for girls? (any age under 18 is considered a restriction)
- When all exceptions are taken into account, what is the minimum age of marriage for girls? (any age under 18 is considered a restriction)
- Is there a gender disparity in the minimum legal age of marriage? (any disparity is considered a restriction)
- What is the constitutional status of customary law? (“Customary law can prevail over some or all of the constitution” and “Customary law is a normative source or legislation cannot contradict customary law,” are considered restrictions).
- What is the constitutional status of religious law? (“Religious law can prevail over some or all of the constitution” and “Religious law is a normative source or legislation cannot contradict customary law,” are considered restrictions).
MCC then uses the same methodology as WBL to aggregate these questions into a single indicator. For example, a country which only had restrictions for one of the 5 questions above would score 80 for the WORLD component of this indicator.
The WBL Index breaks its sub-indicators into eight phases of a working woman’s life, each phase containing 4-5 sub-indicators, which are averaged to create the index. To aggregate these sub-indicators with the WORLD Policy Analysis sub-indicators, MCC creates a ‘ninth’ category focused on child marriage and constitutional protection, which is averaged with the original eight from WBL. This means the WORLD data is 11% of the new Gender in the Economy indicator and the WBL Index data comprises 89%. An illustrative example of this calculation is below.
MCC’s Gender in the Economy Score = [ (WBL Index Score x (8/9)) + (WORLD Childhood Score x (1/9)) ]
For example, if this index had been used in FY21 Afghanistan would have scored 38.125 on the WBL index. On the WORLD questions, Afghanistan has restrictions on all three of the child marriage questions (i.e. child marriage is permitted), but neither of the constitutional/religious law questions. This means that it lacks restrictions on 40% of this category for a score of 40. To find Afghanistan’s Gender in the Economy score MCC averages the eight WBL categories with the ninth category from WORLD: (38.125 *(8/9))+ (40*(1/9)) = 38.3. This gives Afghanistan a final score of 38.3.
In FY22, MCC revised the Gender in the Economy indicator due to changes to WBL’s methodology. WBL now produces a single aggregate score for every country rather than purely disaggregated data. This new indicator added issue areas such as pension equality and parental leave equality to the topics covered in MCC’s indicator while dropping two areas previously covered by MCC’s indicator: child marriage and whether customary law can override constitutional legal protections for women. After consulting with a range of experts on gender and development, MCC determined that it is critical to include measurement of these issues in the indicator. As a result, MCC revised the Gender in the Economy indicator in FY 2022 to supplement WBL’s index with WORLD Policy data on child marriage and customary law, as described above. Due to the change in methodology, FY22 scores are not comparable to previous year’s scores.