The determinants of gender spillovers in FDI: An analysis of Namibia

Abstract

This paper examines the effect of foreign firm characteristics on FDI spillovers in Namibia, with a specific focus on gender spillover, as an additional measure to total labour spillover. Also, the possible differing spillovers in the manufacturing and services firms are investigated. Using data from the World Bank Enterprise Survey for 2006 and 2014, the paper finds that the gender spillover is significantly influenced by four variables; sector, firm age, transport challenges, and supply-chain finance. Relative to the services sector, firms in the manufacturing sector are found to significantly drive gender spillovers due to a probable preference for females “nimble fingers”, perceived obedience, and lower wages. However, the paper documents that older firms, especially those in the manufacturing sector, negatively impact gender spillovers. Also, transport challenges are shown to drive gender spillovers. This result arises from the possibility that they impose an opportunity cost, whereby, firms may defer investing in female labour due to lower perceived wages to compensate for high transport costs. Finally, we document a negative influence of supply-chain finance on gender spillovers, arising from possible labour cuts as MNCs outsource jobs in the supply chain.