The Effects of Real Exchange Rate Fluctuations on the Gender Wage Gap and Domestic Violence in Uruguay

Abstract

work is licensed under a Creative Commons IGO 3.0 Attribution-NonCommercial-NoDerivatives (CC-IGO BY-NC-ND 3.0 IGO) license (http://creativecommons.org/ licenses/by-nc-nd/3.0/igo/legalcode) and may be reproduced with attribution to the IDB and for any noncommercial purpose, as provided below. No derivative work is allowed.Any dispute related to the use of the works of the IDB that cannot be settled amicably shall be submitted to arbitration pursuant to the UNCITRAL rules. The use of the IDB's name for any purpose other than for attribution, and the use of IDB's logo shall be subject to a separate written license agreement between the IDB and the user and is not authorized as part of this CC-IGO license.Following a peer review process, and with previous written consent by the Inter-American Development Bank (IDB), a revised version of this work may also be reproduced in any academic journal, including those indexed by the American Economic Association's EconLit, provided that the IDB is credited and that the author(s) receive no income from the publication. Therefore, the restriction to receive income from such publication shall only extend to the publication's author(s). With regard to such restriction, in case of any inconsistency between the Creative Commons IGO 3.0 Attribution-NonCommercial-NoDerivatives license and these statements, the latter shall prevail.Note that link provided above includes additional terms and conditions of the license.The opinions expressed in this publication are those of the authors and do not necessarily reflect the views of the Inter-American Development Bank, its Board of Directors, or the countries they represent.http://www.iadb.org 2015 Abstract * In this paper, we bring to light the experiences resulting from the significant depreciation of the Uruguayan real exchange rate between 2002 and 2003, followed by an equally considerable appreciation between 2004 and 2010. We explore the link between these fluctuations and the incidence of domestic violence taking place in Uruguay. The real exchange rate is a measure of the relative price between tradable and nontradable goods. While men are traditionally employed in tradable industries, such as manufacturing, women are more likely to work in nontradable industries, such as the service sector. A change in the real exchange rate, therefore, can affect the potential wages of men differently from those of women. In line with the models that represent household bargaining, an increase in the real exchange rate can generate an increase in the bargaining power of men relative to that of women within the household. We present evidence that it raises the frequency of domestic violence. This holds true in rich and poor areas of the city.JEL Code: K42

Engendering Macroeconomic Theory and Policy

“…Exchange rate policy can also affect rates of domestic violence, transmitted through the impact on gender wage gaps. Munyo and Rossi (2015) explore the effect of depreciations and appreciations of the Uruguayan real exchange rate (measured as the relative price of tradable and non-tradable goods). Men are concentrated in tradable industries such as manufacturing, while women are more likely to work in non-tradable industries such as the service sector.…”

Domestic violence reporting during the COVID-19 pandemic: evidence from Latin America

“…Fundamental (or structural) factors refer to deeply rooted economic, social, or cultural drivers of violence, such as social norms about violence tolerance, economic gender inequality, and poverty (Gibbs et al, 2020 ; Jewkes, 2002 ). Situational factors refer to circumstances that can trigger violence, such as negative economic shocks (Aizer, 2010 , 2011 ; Anderberg et al, 2016 ; Bhalotra et al, 2021 ; Bobonis et al, 2013 ; Buller et al, 2018 ; Munyo & Rossi, 2015 ; Pronyk et al, 2006 ); stress, anxiety, frustration, and depression (Brooks et al, 2020 ; Card & Dahl, 2011 ; Munyo & Rossi, 2013 ); exposure to perpetrators (Dugan et al, 1999 ; Peterman et al, 2020 ); substance abuse (Abramsky et al, 2011 ; Angelucci, 2008 ; Devries et al, 2014 ); pollution (Herrnstadt & Muehlegger, 2015 ); and other environmental factors (Henke & Hsu, 2020 ; Sanz-Barbero et al, 2018 ).…”

Confinement and intimate partner violence†

“…Second, it links with the long‐standing research on the sources of violence against women, especially by intimate partners, that spans various disciplines. In economics, this line of research is related to how violence against women is affected by female economic dependence, wage gaps and job opportunities (e.g., Aizer, 2010; Basu & Famoye 2004; Bhalotra et al, 2020; Bobonis et al, 2013; Bowlus & Seitz, 2006; Farmer & Tiefenthaler, 1997; Munyo & Rossi, 2015), alcohol abuse (Angelucci, 2008), health (Papageorge et al, 2019), or structural poverty (Aizer, 2011). There is, in fact, part of this debate linking pandemics to intra‐family violence.…”