Gender equality is good for the poor.

The relationship between the incidence of poverty and the level of gender equality as measured by various alternative indices suggests that developing countries with higher gender equality tend to have lower poverty rates. The chart presents a scatter plot of poverty headcount ratio (for the $2 per day poverty line) and gender equality as measured by the female-to-male ratio of sex-specific Human Development Indices for a set of 73 countries circa 1997. The inverse relationship between gender equality and poverty shown in this scatter plot is quite robust to other measures of poverty and other measures of gender equality. Bivariate correlations of course cannot establish causality. One could easily argue for example that increases in wealth drive increases in gender equality-rather than the other way round-since discrimination may become increasingly costly to firms in developed economies with tighter labour markets. In fact cross country correlations and even more rigorous regression analysis are unlikely ever to allow us to establish definitive relationships between gender equality and poverty; the simultaneities are too great and we do not have suitable econometric instruments to solve this problem. (excerpt)