Book Review – The Diane Elson Reader: Gender, Development and Macroeconomic Policy. – Beragampengetahuan

Book Review:  Diane Elson. 2025. The Diane Elson Reader: Gender, Development and Macroeconomic Policy. Agenda Publishing.
Annavajhula J C Bose, PhD
Former Economics Professor, SRCC

Every undergraduate girl student of economics must know who is Diane Elson  and read  this book of hers. Here is a summary.

The bone of contention of Elson  is that we are not going to have a better world in terms of a gender-equitable sustainable economy unless economic analysis is “challenged and transformed so that fostering equalities (gender, class, race, ethnicity, location) becomes a central objective.”

We need to look at economies as “gendered structures” of power that need to be transformed economically, socially and politically. In other words, there is male bias “stemming from modelling the economy from a male perspective. It results in policies that are biased against women and mean that women, especially poor women, disproportionately bear the burden of adjustment” or reform. This needs to be removed.

Macroeconomic policies exhibit five forms of male bias. First, there is “deflationary bias”. It is “inherent in the decision to prioritise credibility in financial markets, through high interest rates, tight monetary policies and fiscal restraint, over other objectives. Such policies in fact deter investment and place disproportionate burdens on women living in poverty.” Secondly, there is the “Male breadwinner bias”. This means that when full employment is emphasised as the most important goal, “gendered character of the labour market, and the barriers to women taking full-time jobs” are ignored.  Besides, “it constructs social protection in ways that make women dependent on men.” Thirdly, there is the “Commodification bias”.

According to this, “health, education services and care services, and pensions and insurance, are all delivered more efficiently (i.e. at lower monetary cost) if public services are replaced by private provision for profit. This ignores adverse impacts on quality of services and access to services for users, especially women, and on the terms and conditions of those who provide them, disproportionately women.” Fourthly, there is the “Risk bias”, which is “embodied in governance that reduces the extent to which risk is pooled, and measures to protect against it are shared, and instead individualises risk. This disproportionately penalises women because they have fewer assets to fall back on than men, and tend to be perceived as more risky borrowers than men.” Lastly, there is the “Creditor bias” which means there is an “asymmetrical treatment of creditors and debtors, especially large, powerful creditors and small individual debtors. For example, in the global financial crisis of 2008, big American banks were bailed out, but African American women who were unable to service their home loans had their homes repossessed.”

To understand how these biases operate, we need to understand the economy as operating at three levels: macro, meso and micro. At the micro level, there are people producing for sale and meeting needs in households. Firms and households should not be treated as individuals. Instead, they should be recognised as being “structured by gender, divisions in roles, responsibilities and power. The behaviour of men and women, boys and girls is not the outcome of exercises in constrained optimisation, given preferences and endowments, but is shaped by gender relations and conflict as well as cooperation.” At the meso-level, there are institutions of markets and public services of all kinds by the state. These institutions “embody (often in ways not immediately visible) gendered laws, norms, rules and information systems. For instance, labour markets are structured by practices, perceptions, laws, norms and networks which are based on presumptions about what is women’s work and what is men’s work and operate to devalue tasks that are considered to be women’s work.”

At the macro level, the economy is usually represented by GDP as the measure of the market value of total output produced by paid work. The size of the productive economy is underpinned by measures of output in sectors such as agriculture, industry and services and their sub-sectors. In each sector, there is gender division of labour, some making intensive use of male labour and others intensive use of female labour. This picture does not show up the “reproductive economy”. The point is that the “ability of money to mobilise labour power for productive work (which produces goods and services for the market) depends on the operation of non-market social relations to mobilise labour power for reproductive work (which provides goods and services needed to reproduce people on a daily and inter-generational basis.”

The reproductive economy has unpaid work, and to create a more gender-equal economy, policy should reduce this work “through public investment in water, sanitation, clean energy and care services; and it should redistribute the remaining unpaid work through incentives and support for men and boys to take an equal share.” However, macroeconomic policies are implemented without any consideration of their impacts on the unpaid work in the reproductive economy so much so that the reproductive economy fails to “sustain health, nutrition, education, and skills when so-called economic reforms cut public and community services, to the detriment of both human wellbeing and improvements in productivity in the productive economy.” Macroeconomic policies are implemented like that only because labour is treated as non-produced means of production. This is a blunder. It may be noted that the depletion of capabilities in the reproductive economy which is otherwise known as social reproduction “does not by itself necessarily create a crisis for the continuation of a capitalist mixed economy…If it leads to a shortage of labour for the private sector, then private sector production may simply move to other locations in other economies where there is an ample labour supply. However, if technological developments mean that the private sector increasingly wants healthy, educated labour, then deep and ongoing depletion will hinder capital accumulation. Moreover, it may lead to challenges to the legitimacy of the configurations of power governing the economy, especially if the NGO sector provides information about the human cost of the depletion and collective campaigns against it.”

An important related point to be underscored is that for social reproduction to take place, investment in “capabilities has to take place over the whole of the life course, from birth to death; and that much of this investment is the investment of time in unpaid care for other people. While this investment can be influenced by market incentives, it cannot be reduced to a form of rearing livestock. Social reproduction is governed by social norms, by systems of cooperation and conflict in families and communities, rather than systems of buying and selling in markets…This means there is no guarantee that the processes of social reproduction will supply labour of the quantities and qualities required for economic growth simply in response to price signals.” Little wonder that because spending money on delivery of public services is treated as consumption rather than as investment, there is always the danger of under-investment in human capabilities in market driven economies.

The growing dominance of finance further complicates the interaction of the productive and reproductive economies. Elson elaborates well: “The wealthy rentier households own financial assets, managed by financial services companies, from which they derive a large part of their income. The majority of households own few financial assets and owe substantial debts to financial services companies. These net debtor households derive most of their income from work, not asset ownership. The wealthy rentier minority do very little unpaid work, instead paying for substitutes, such as domestic workers; and make very little use of public services, instead paying for private services. In contrast, the majority of households rely much more on unpaid work and also on public services.

Financial services companies, especially international financial service companies, exercise power over net debtor households, and also over governments who rely on selling government bonds to finance the gap between public expenditure and revenue from taxes. Wealthy households and large and medium businesses pressure governments to reduce their taxes, both through reduction of tax rates, and through a myriad tax concessions, often obscured from view. International businesses and international financial corporations collaborate in a system of international tax avoidance and evasion which deprives governments of revenue to fund public services and benefits the wealthy rentier households who can keep their wealth offshore. This wealthy minority, and international financial companies and international businesses are relatively footloose, able  to move their operations to other countries with lower taxes and laxer regulations.

Local businesses and the majority of households are not footloose in the same way. People from these households do migrate to other countries but in difficult and onerous circumstances, leaving them open to a variety of forms of exploitation. If governments prioritise the interests of rentier households, their policies will be marked by deflationary bias and commodification bias, and there will inevitably be pressure on women in the majority of net-debtor households to act as provisioners of last resort, expanding, as far as they are able, their unpaid work. Responses that are marked by male breadwinner bias will not address the needs of women for independent entitlements and may further deepen their dependence. Deregulation has created an international financial system that is fraught with risks, and in times of financial crisis, risks are downloaded from the dealing rooms of financial markets to the kitchens where low-income women strive to provide meals for their families. In the Asian financial crisis in the late 1990s, the World Bank and the IMF imposed policy conditions that intensified the pressures on low-income women, while advocating that a few narrowly targeted social safety nets be added on.”

It must be noted that financial liberalisation has produced a global economy that is prone to financial crisis, as in Latin America in early 1980s, Asia in late 1990s, and Global North in 2008-09. The gendered impact of such a crisis “in the sphere of production varied by sector and country. In some, male-intensive sectors like construction and cars were harder hit and men lost jobs; in others export-oriented female-intensive sectors like garments were harder hit and women lost jobs. Faced with growing male unemployment, some governments introduced a fiscal stimulus, focussing on supporting construction and cars. However, there were adverse reactions to rising government debt in the bond  markets, pushing up rates of interest on government debt for many governments, and in many countries austerity policies were introduced, leading to increases in female unemployment, as women tend to be disproportionately employed in the public sector. The austerity policies undermined provision of public services and social protection transfers, even in many European countries where there had been a welfare state…Unpaid work tended to rise, including through volunteer work in operating food banks, and in more labour-intensive shopping and meal preparation using cheaper ingredients. But the sphere of social reproduction cannot provide an unlimited safety net…more women sought help for mental health problems due to the increased stress they were under.”

In such a milieu of globalisation, women’s struggles for gender responsive budgeting for expanding fiscal allocations to the public services and social protection systems  do not succeed: “Trade liberalisation reduces revenue from taxes on imports and exports. Competition to attract investment leads to cuts in corporation tax, an introduction of tax holidays and other exemptions. Moreover, countries are encouraged to borrow from commercial banks and other financial businesses at floating rates of interest, and when central banks put up interest rates, there is a knock-on effect with rising interest rates on government debt, so that debt service payments take an increasing share of public expenditure. In order to build a reputation for sound finance in international financial markets, many governments have adopted fiscal rules which limit fiscal space and put downward  pressure on public expenditure.”

Elson concludes that gender equitable inclusive growth requires many things—closing “gender gaps in employment of decent work by increasing the creation of decent work for both men and women, with a higher rate of expansion for women than for men; increasing public provision of affordable housing, clean energy, safe public transport, clean water and sanitation, and health, education and care services which can be environmentally sustainable and wellbeing enhancing, particularly for women as it can reduce women’s unpaid work and enable them to access decent paid work; and equal redistribution of the remaining unpaid work between men and women”. Also badly required is rebuilding an international financial system “that avoids deflationary bias, male-breadwinner bias and commodification/privatisation bias, and does not preclude democratic public policy dialogues, in which the interests of women in the kitchen could be represented. This would require reinstating controls on flows of finance into and out of national economies, so that buyers and sellers of financial instruments, such as bonds and equities, have fewer options to be footloose. It is difficult to conduct a democratic public policy dialogue when some of the key actors have no stake in the outcome beyond the next few hours and are able to foreclose discussion by selling their bonds or equities.”

Diane Elson is a towering personality of influence among feminist economists in the world, and her presence needs to be celebrated by girls, women, boys and men.

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