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3. Literature Review

section reviews the literature on labor force participation (LFP) and labor
supply both in Bangladesh and worldwide.

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et al., (2000) found that the growth rate has a positive impact on the
employment level. However, there is a negative relationship between employment
and labor productively. Female Labor Force Participation (FLFP) rate is over 40 percent in
Bangladesh and Nepal, 32 percent in India and Bhutan, 36 percent in Sri Lanka
compared to only 27 percent in Pakistan (World Bank, 1999; UNDP, 1995a). Aly
and Quisi (1996) investigated socio-economic factors that influence Kuwaiti women’s’
labor market participation decision. Discussing FLFP rates in a macro level
study for west Malaysia and Singapore, Fong (1975) estimated the changes in
these rates from 1921 to 1957 and related these changes to socio-economic

(2005) has argued that increasing female labor force participation in
Bangladesh has been due to better enumeration of women’s home based economic
activities. The major focus of the paper is on the factors associated with
women’s participation in paid employment. The study obtained the results that  women 
who  are  heads 
of  households, have a
smaller  family  and 
less  education,  live 
in  urban areas and have less
wealth are more likely to engage in paid work. The number of children below age
five has an insignificant impact while microcredit borrowing has a positive
impact. The only problem is related to the interpretation of the impact of education,
which actually is similar to the wealth impact. Both may, again, be due to the
fact that paid work is actually a combination of regular salaried employment
and daily employment.

A study by the Asian Development Bank (ADB) and ILO
(2011) looked at the labour market situation in Asian countries and especially
highlighted the impact of the global financial crisis, which engulfed the
industrial economies since 2008. Although it does not analyze the Bangladesh
situation separately, some of the policy conclusions for South Asia region can
be very relevant for this country. The 
study highlighted  that  gender 
inequalities  are  rooted 
not  only  in 
social  and  cultural 
norms  but  are 
also deeply entrenched in the policy focus and institutional


Rahman and Islam (2013) stated that female wage is
observed to be only two thirds of the male wage. The ratios are similar for
rural and urban areas. The female to male ratio for monthly salary of employees
is much lower than the ratio of daily wage. Gender differential of wage consists  of 
three  factors,  gender 
segmentation  of  occupation, 
differences  in  endowment 
and  pure discrimination, which is
linked to the lower bargaining power of female workers.

(1987) observes that the higher the education of a woman, the higher is the
opportunity cost of not producing cash income and the higher is the probability
that she participates in market work. Husband’s education has a negative
effect. Similarly, increase in female wage reduces the probability of women’s
home production.

and Begum (2000) draw on a combination of survey data and published studies on
the RMG sector employment. The 
papers  provide  information 
on  work  environment 
and  the  extent 
of  gender differences in the
terms of employment. The studies report that women employed in the RMG sector have
a lower mean average age compared to their male counterpart. The average age of
women in the latest survey was 20.4 years compared to 25 years for male workers
in the sample. According to GoB (2006), safety in case of fire and for other
hazards has been documented in Bangladesh Labor Act.

(1981) has stated on the aggregate level of rural labor supply. He said that rural
unemployment is not involuntary largely prevalent among family workers of
middle and rich farm households. Landless and land-poor wage workers do not
remain unemployed even for a few days, except during natural calamities when
crops and employment potentials are lost. Hossain (1996) argues that since the
rural people in Bangladesh live in village generation after generation, they
know how to adopt and cope with the vulnerable situation. The author says that
the rural people have developed various income and employment smoothing
mechanisms through which they can manage to remain employed. Over the year
landlessness and near-landlessness is gradually increasing while it is neither
a necessary nor a sufficient condition for rural poverty.

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