The Policy Research Working Paper Series disseminates the findings of work in progress to encourage the exchange of ideas about development issues. An objective of the series is to get the findings out quickly, even if the presentations are less than fully polished. The papers carry the names of the authors and should be cited accordingly. The findings, interpretations, and conclusions expressed in this paper are entirely those of the authors. They do not necessarily represent the views of the International Bank for Reconstruction and Development/World Bank and its affiliated organizations, or those of the Executive Directors of the World Bank or the governments they represent.

In discussing the inordinately low employment of Indian women in urban areas, several studies have argued that culture and attitudes have created a labor market that is inherently discriminatory. The unsaid corollary is that culture is slow and hard to change and so, women will stay out of the labor market until social change occurs. The empirical evidence on the role of culture is slim at best. This paper fills the void in the policy literature, as it assesses the relative role of culture, as signified by attitudes of employers, and firm characteristics in hiring women. The paper is based on a unique survey of 618 firms in three of the largest cities in the state of Madhya Pradesh (India)-Bhopal, Indore, and Gwalior. Using detailed descriptive, bivariate and multivariate analysis at the firm level, the hiring process, and attitudes toward male and female workers, the paper addresses the issue of culture and firm characteristics, while noting that the two are not necessarily in binary opposition. The results reinforce the conventional wisdom in some ways and are surprising in others. The most salient result is that employer attitudes matter much less for the chance that women will be hired, than do firm and location characteristics. This has significant policy implications, the most important of which is that female employment in urban India is amenable to policy intervention, and that it is not necessary to wait for culture to change.

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It is often assumed that improvements in household wealth are associated with greater gender equality, including greater women’s autonomy and decision-making power inside the home. Yet, evidence often shows the opposite: greater household wealth often curtails women’s autonomy. Research has yet to reveal the driving forces behind this surprising finding. This paper focuses on one important social force, the community gender system, to show how it shapes the relationship between changing household wealth and women’s autonomy. Drawing on a nationally representative panel of rural women in India and fixed effects models, I find that the prevalence of women’s veiling at the village level, a notable marker of an exclusionary gender system, moderates the effects of increasing household wealth on women’s autonomy. In villages with less veiling, increases in wealth have the perverse effect of suppressing women’s autonomy. The study suggests that in these places, households curtail women’s mobility because such behavior signals rising social status. In contrast, in villages with more veiling increasing household wealth does not reduce women’s autonomy because most households across the class spectrum are already conforming to the norms of seclusion. The findings demonstrate how new wealth interacts with a community gender system which is anchored in gendered notions of family honor to reproduce structures of gender inequality.

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