Studying economics can provide a powerful tool for understanding the world. Whether the goal is to understand the distribution of goods, the intersection of economics with international development, or the role of foreign direct investment (FDI) in a domestic economy, studying economics can connect data to theory to enable real and meaningful change.
In recent years, the academic and policy community has shown interest in exploring the impact of foreign investment and multinational organizations on gender equality and women’s empowerment. Economist and SIS professor Jennifer Poole is an active contributor to this research, supported by grants from organizations like the United Nations and the Inter-American Development Bank (IDB).
We sat down with Poole to hear about her experience as the lead consultant on a report for the UN and discuss what she’s researching at the intersection of economic development and women’s empowerment.
Increased Interest in Studying Economics of Women’s Empowerment
Since her own time in graduate school, the core of Poole’s research has focused on the implications of a more globalized world, primarily through increases in cross-border trade and foreign investment, on local outcomes, such as worker’s employment and wages. It wasn’t until more recently that Poole made a slight turn in her research to particularly focus on the implications of a more integrated global economy on women.
“Much of my previous work was generally focused on employment and wages—inequality—thinking about the role of domestic policy institutions—labor laws—and how they interplay with external national policies,” Poole explained. “Only recently did I start thinking about the implications on women specifically.”
As an economist, Poole teaches an economic development class at SIS in which gender has a “prominent place on the syllabus.” Poole explained that her interest in the intersection of economics and gender has always been there, but it took time for the “academic and the policy world to become interested in it.”
Researching Economic Gender Equality for the UN
Under the umbrella of gender equality, Poole has three different research agendas: studying the impact of foreign direct investment on the transmission of gender policies and practices, the role of external shocks on domestic economies, and how digitalization and e-commerce can empower women entrepreneurs.
Her research at the intersection of economic development and gender equality began about five years ago when Poole was selected to be the lead consultant on a report for the United Nations. The report examined the impact of multinational enterprises—companies that operate in at least one country outside of their headquarters operations—on the transmission of gender policies and best practices.
This report was the “first to present empirical evidence on the indirect spillover effects” of multinational enterprises on gender equality in local labor markets. In essence, the report examines how the employment policies of companies founded in countries with more gender-equal policies—like the United States—can impact gender equality in labor markets local to areas far removed from the US.
Poole explained that “theory tells us that more foreign direct investment—especially FDI from more gender-equal countries like the United States—can enhance income, and there’s a strong positive correlation between income and equality of opportunity.” Her research, however, tests that theory with data.
“We don’t want to set policy based on assumptions; we don’t want to set policy based on one anecdote,” Poole said. “We want to set policy based on systematic evidence.”
In a UN special issue on multinational enterprises and gender equality, Poole and SIS professor Austin Davis worked together on research published in 2020 titled “Can Multinational Firms Promote Gender Equality?” Poole and Davis specifically investigated the role that multinational enterprises and foreign direct investment play in spreading gender equality in Brazil.
Poole and Davis examined administrative data that traced the employment of workers over time between 1996 and 2004, which was a “period of dramatic trade and investment liberalization across the country.”
Through research, Poole and Davis explored whether workers who moved from a multinational enterprise to a local firm brought with them some of the best practices for women's employment and women's empowerment. Their research found that the movement of workers from multinational to domestic firms had “relatively small effects on labor market outcomes for women.”
In September 2023, Poole and Davis published a follow-up article on the topic (supported by the IDB) for a more recent time period—one in which substantial debate exists on the role of Chinese investment in Latin America. Through their research, Poole and Davis discovered that increasing the share of workers with multinational experience “modestly improves the gender earnings gap.”
Poole said the “small positive effect” indicates that women workers are taking empowerment practices and principles with them when they leave multinational firms and “spreading them across the country even more.”
“We noticed that, for the case of Brazil in this context, women and managers are highly likely, when they move from a multinational to a domestically owned firm, to then spread relatively higher wages for women,” Poole explained. “The gender gap in those new firms decreases, which we can then hypothesize or deduce is coming from some of the transfer of knowledge from the multinational to the domestic firm.”
Impacts of External Shocks and Digitalization on Women
In addition to her research for the UN, Poole has focused her research on gender equality in two other areas—the role of “external shocks,” like digitalization and currency crises.
Poole’s research on the role of currency shocks in the local economy on women has investigated how policies and labor laws designed to protect women—like maternity leave or family sick leave—can impact women in the workplace.
“We think about these policies that, at the outset, policymakers put in place because they want to see these protections, but by having such protections in place, it also raises the cost of these workers for the firms,” Poole explained.
As a result, Poole’s research has found that firms in Brazil are hiring more contract workers so that they are not required by law to pay for extra benefits, like vacation and sick leave.
“We’re seeing a large expansion of legal—but also not fully adhering to labor laws—contract work,” Poole explained. “That is something that we’re looking at differently for women and men because, again, since many of these labor laws on the books disproportionately impact women, our hypotheses and our predictions are that this precarious contract work might also be disproportionally falling on women.”
The third branch of Poole’s research focuses on the role that digitalization and e-commerce can play in connecting women to foreign markets. In her research, Poole’s hypothesis begins by acknowledging that “women are very different entrepreneurs than men at times.”
“We tend to start our businesses maybe based on a passion or a hobby, and we might do it in non-traditional hours of the day,” Poole said.
In research published in August 2023, Poole’s analysis provided evidence that “digital platforms can play an important role in making trade more gender equal.” Poole specifically examined firms participating in ConnectAmericas, a free, informational online platform designed to guide and support business internationalization.
Through research, Poole found that ConnectAmericas increases export values for women-led firms by “almost 40 percent within product and destination but increases export values for equivalent men-managed firms by only around 10 percent.”
“This is where the benefits of access to a digital platform differentially benefit women entrepreneurs than men,” Poole explained. “Men tend to have more access to this information already, so men still benefit from the platform without a doubt. The idea is that women benefit even more from the platform, maybe in part because they didn’t have as much access to this information as before.”
“Pure Theory is Not Going to Take Us Far”
While Poole says she’s “not known to predict the future,” she’s hopeful that the “momentum continues” surrounding research on economic development and women empowerment. In October 2023, Poole presented her research at the World Investment Forum in Abu Dhabi and the European Bank for Reconstruction and Development conference in London—both of which included panels on economics and gender.
Poole said she’s also encouraged by a trend she’s witnessed of more policymakers connecting with academics in various areas of economic policy ideas—including gender. While academics “are more rarely pure theorists,” Poole stressed the importance of “taking the theory to data” and translating research for policymakers.
“Having pure theory is not going to take us far. We need to take that theory to the data and connect with policymakers to put it in place for a more equitable, more sustainable livelihood for all—that is the goal,” Poole said. “That is definitely a shift I have noticed in recent years, and I think that is indeed strengthening, even at the very upper-echelons of what I would consider to be the Ivory Tower academics—recognizing that our work needs to filter further, and to do so, we need to be able to translate our work for the policy audience.”