Women’s power is critical to economic growth. People did not always think so.

Fifty years ago, most development economists thought gender had nothing to do with economic development. Development was all about capital, labor supply, productivity and education. Women’s issues were the stuff of personal life, not economic life.

Marxists were not much better. Development depended on how much the peripheral economy resisted imperialism. Feminism was a bourgeois distraction.

That was then. This is now. Both types of scholars have learned their lesson. Women’s power is fundamental to economic development. Conservative economists agree with feminists on this point. The World Bank is not a particularly leftist organization; neither is the International Monetary Fund. Both the World Bank and the IMF have been outspoken advocates for gender equality and women’s rights.

Why is women’s power and autonomy so important to economic growth?

1. When Women Are Empowered, They Can Start Small Businesses. Small Businesses Are The Foundation From Which Other Firms Grow. Independent women are micro-entrepreneurs. Their businesses are often elementary. Farm wives grow extra food above and beyond what is needed for the family. They take this extra produce to the market to sell. Women make extra clothing they offer for sale. Artistic women make decorative items.These small domestic industries turn out to be unbelievably important. Scholarship on the Industrial Revolution shows that the rise of modern factories in Europe depended on an earlier stage of “proto-industrialization” or “cottage industry” where workers manufactured at home. Among these eighteenth-century proto-industrialists, women were just as important as men. Nowadays, these firms are called “microenterprise”. They are just as important in today’s Global South as they were in historical Europe.

Why does microenterprise lead to economic growth?

a) The women make money from these businesses which they spend. Their expenditures increases the markets for other firms. Mothers buying food and clothing for children increases the sales of grocers and clothing stores.

b) The women buy supplies for their businesses. This benefits industrial suppliers. If women become hairdressers, this is good news for the company that makes salon chairs.

c) Some microenterprises succeed beyond all expectations and become macroenterprises. We all know how Apple Computer got its start from two kids tinkering with computers in their garage. Liquid Paper was founded by an executive secretary, Bette Nesmith Graham. She needed something to paint over her typing errors. Two decades later, Bette Graham sold her company for over 45 million dollars.

2. When Women Are Empowered They Become More Educated. Economic development depends on having a productive labor force. Education makes workers more productive. Unempowered girls are prevented from attending school. Families make them stay home to help with chores. Fathers keep their daughters uneducated so they will be subservient and respect Papa’s wishes. Women who aren’t literate or numerate will be effective at being entrepreneurs. They will also be unproductive workers. South Korea gives women over 11 years of education. Sudan fewer than 3. There is starvation in Sudan but not in South Korea.

Increasing female education also increases the productivity of males. The education process starts in the home with mothers educating children. Educated mothers will raise children with more academic skills. They will read earlier. They will supplement their classroom learning with knowledge and skills obtained in the home. Girls trained by educated mothers will have higher human capital. So will boys.

3. Nations With Empowered Women Have Better Population Control. Controlling population growth is essential for economic growth. If an economy grows at 4% but the population grows at 5%, the population will continue to be poorer, as national output has to be divided among ever-increasing numbers of hungry people. The key to decreased population growth is reducing fertility, the number of children born to each woman.

Empowered women are more capable of controlling their fertility. They are more educated, so they have a better understanding of contraception. They are working outside the home, so they limit their family size to reduce the amount of time they must expend on childcare. Greater education also reduces female fertility by keeping women in school longer – where having a child is incompatible with academic demands.

Empowered women also have more capacity for saying no to husbands and boyfriends. A woman who depends on her husband for income and everything else in life, has little leverage with which to turn down his sexual demands. A woman who out-earns her husband has a lot more say in setting the terms of their relationship.

4.Women Commit Family Financial Resources to Children’s Education and Welfare. Men Spend Their Money on Recreation or Warfare. Women invest in children in ways that men do not. They are the caretakers. They make sure their children are well fed. They make sure that the children have clothes for school. They make sure their children have their schoolbooks and that they have done their homework. Men take their money and go drinking with their friends. Even if men take on childcare responsibilities, they are more likely to play with the children than concentrate on sustenance and schoolwork.

*  *  *

Because of this, there is a clear correlation between women’s status and economic growth. It has been estimated that increasing the percentage of women with secondary education by 1% raises per capita GDP by 0.3%. Calculate for yourself what would be the effect of taking a society with 0% of women with secondary education and moving to having 75% of the women having secondary education. That is a lot of national wealth. The world is richer when everyone is educated, capable and autonomous. Empowering two sexes rather than one can make the world twice as wealthy.