Trade Openness and Gender in Uruguay: A CGE Analysis

Survey results from Uruguay show that there is gender discrimination in the private labor market, and that women spend more time than men doing domestic work and less time in the labor market. We take these and other features of the survey into account to build a gender aware CGE model with endogenous labor supply and a home production function. This kind of model is a useful tool to evaluate the impact of different policies, in particular those relating to gender. In this paper we analyze the gender-differentiated impacts of trade openness in Uruguay on employment, wages and time allocation. We simulated different scenarios of tariff changes. Greater trade openness improved the situation of women in terms of employment and wages, but the impact on gender gaps depends on how trade openness affect trade flows. If net exports to Argentina increases, demand for female labor increases and the gender gap goes down. However, if net exports to Brazil and the rest of the world increase, unskilled male demand expands. When considering time distribution, the impact also depends on the elasticity of labor supply, which differs by skill.