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The annual cost of keeping women at home is $574 billion 02/04/2012 - Viewed 3312 times

Those of you who watched TV in the 90s might have come across a show called Sliders. It’s about a group of people who travel across parallel universes, each with its own alternate version of reality. They come across worlds in which the Germans won World War II or the planet is threatened by a giant meteor. In one episode women are the dominant gender and Hillary Clinton is the president of the United States. It’s important not to get caught up in “what ifs,” but sometimes this kind of thinking can shed light on the consequences of our decisions. From a development point of view, it pays to ask what kind of country we would be living in if we had taken different steps in the last three decades.

I will use the below table to answer the question. When I was preparing these figures, I used the “back of the envelope” method combined with the “if my aunt had a beard, she would be my uncle” approach. I chose to compare Turkey with South Korea since the two had a similar level of per capita income three decades ago. Another reason would be that as a person who has lived in Istanbul and Ankara, I am bursting with envy after I saw Seoul last week.

Let’s focus on the first two rows of the table and compare the current state in Turkey and Korea. Here are the eye-catchers:

• Though Koreans are twice as rich as Turks, the same proportion does not apply for productivity (output per worker.) The annual value of output per worker is $30,000 in Turkey while Korea’s is 37 percent higher, at $41,000. Despite Korea’s recent ascent to developed country status, it does not have an output per worker as high as France ($100,000) or Germany ($86,000.)
• Korea’s population is 49 million compared to Turkey’s 73 million. Each has a labor force of 25 million. In other words, Korea’s 25 million workers have to take care of 49 million of their compatriots, while their Turkish counterparts have to take care of 73 million.
• The number of women in the labor force is 10 million in Korea and 7 million in Turkey. This difference is caused by the rate of female labor force participation dragging behind (24 percent.) I believe that the main difference between Turkey and Korea in these figures lies in the participation of women in the labor force.

Now, let’s check the last two rows which rely on a very simple calculation and the “if my aunt had a beard” method:

• Under Scenario 1, I assumed that the female labor force participation rate in Turkey was the same as that of Korea. I also assumed that the 7 million women who were to join the labor force would achieve Turkey’s average level of productivity, corresponding to an annual value added of $30,000 per worker. Under this scenario, Turkey could have a per capita income of $13,000 and a national income of $1.1 trillion today.
• Under Scenario 2, I assumed that the rate of female labor force participation and level of productivity was the same in Turkey as in Korea (50% and $41,000, respectively). If this were the case, Turkey’s per capita income would be $18,000 and its national income would be $1.3 trillion. In this scenario we would be the thirteenth biggest economy of the world, right after Spain.

I hear you asking: If such a high proportion of women were to join the labor force, how would we create jobs for them? How would we be able to raise their productivity level to Turkey’s average, or to raise our average level of productivity to that of Korea?

Then let me ask: What the hell has Turkey been doing in the last three decades if it hasn’t been taking care of these problems? What, for example, have we done in order to set a more flexible labor market for women in particular, to furnish women with knowledge and skills, to strengthen child care services, to modernize and prompt competition in the services sector apt for urban women, to enhance public transportation in a way to encourage women to leave their homes and safely travel to work? What were we thinking while Koreans, much poorer than us, were opening the Seoul subway in 1974? How can we explain the fact that the Istanbul subway, which was opened finally in 2000, has only twelve stations and Seoul has 328?

I also hear some of you consoling yourselves with the classical story about how Turkey is oh-so democratic and Korea is not. Could you please explain to me how Turkey can be a democratic country without women?

Table: National income, population, per capita income, output per worker, labor force, female labor force and female labor force participation rate in Turkey and Korea, 2010.­

Source: TURKSTAT, Statistics Korea, World Bank World Development Indicators

*Esen Çağlar, TEPAV Economic Policy Analyst, http://www.tepav.org.tr/en/ekibimiz/s/1025/Esen+Caglar