Answer to Question #126155 in Macroeconomics for Reina

Question

The participation of women in the Gambian labor force has risen dramatically since 2000.
How do you think this rise affected GDP?
Now imagine a measure of well-being that includes time spent working in the home and taking leisure. How would the change in this measure of well-being compare to the change in GDP?
Can you think of other aspects of well-being that are associated with the rise in women’s labor-force participation? Would it be practical to construct a measure of well-being that includes these aspects?

Answer 1

a) The dramatic rise of women in the Gambian workforce will lead to an increase in the country's economic output hence rise in GDP per capita.

b) With more women joining the workforce, there will be a fall in both leisure and time spent working at home. Since well being is a measure of the time spent home, it will fall in value as more women join the labor force. Therefore the The change in this measure of well-being would be less the change in GDP..

GDP, on the other hand will show an improvement, as output will increase because of more employment.

c) The amount of time spent with mothers is very important for the health of young children both Physically and mentally. With women spending less time at home nurturing the children, well-

being of children would decrease. With women participating in labor force, the well-being of family members would decrease as they would not be able to enjoy the the services of women at home. Thus, the increase of GDP may be accompanied by a decrease in well-beings at home.

Due to the measurement challenge, it is not practical to include all aspects of well-being into account while calculating GDP. For example, it takes years before the well-being of children can be compared for working and non-working