This paper investigates how women’s promotions in the workplace affect bargaining in the household. I exploit the design of a promotion programme for women in 27 Bangladeshi garment factories, by comparing women who were quasi-randomly selected for the programme to the shortlisted runners-up. Results using three different estimation approaches (OLS with post-double selection Lasso, regression discontinuity, and matching) show that women’s bargaining power increases as a result of the promotion. The effects are largest for the share of income households spend on assignable goods for women (especially clothing and accessories) and remittances. The latter appears to mask expenditures on children, since remittances increase most for women whose children live with other relatives. I find that these direct effects of the promotions are amplified by impacts on women working as subordinates of the new female managers. Using the quasi-random assignment of sewing-line operators to production lines for identification, I observe that women exposed to a female manager have more say in decision-making in the household, especially about their own mobility. Overall, I find suggestive evidence that both the direct and the indirect impacts are driven by women gaining confidence to get involved in bargaining, rather than income effects that ease the budget constraint or changes in the relative wage in the household.
Author: Hannah Uckat, Department of Economics, University of Oxford