Sabine Mauderer: Gender economics
Speech by Dr Sabine Mauderer, Member of the Executive Board of the Deutsche
Bundesbank, at the G7 CeBaDi Diversity, Equality and Inclusion Summit 2022,
Frankfurt am Main, 4 November 2022.
* * *
1 Introduction
Dear central banking colleagues, dear guests,
A very warm welcome from me, too. I am very proud that the Bundesbank is hosting
this year's Central Bank-HR Diversity, Equality and Inclusion Summit. It goes without
saying that diversity matters for any institution. And for central banks in particular, as
they act on behalf of the wider public.
I would like to start today's talk by showing you a photograph of the ECB's governing
council. This photo was taken during an informal gathering at a country house hotel
outside Frankfurt about three years ago. Let's take a look. Here you can see a group of
mostly middle-aged, white European men sitting around a large table. There is also one
woman at the table, President Lagarde. So, what can we deduce from this?
First, decisions are taken by a group. That is positive by itself, because ideally the
decision-making process should reflect the different values and perceptions of all
members. However, the group appears to lack diversity. True, a person's outer
appearance can be deceptive. It does not necessarily tell you anything about his or her
value set or perceptions.
Nevertheless, it is widely acknowledged that diverse teams -- be it in terms of gender,
ethnicity or thought - produce a wider range of opinions, leading to better and more
robust results. It is also widely acknowledged that a more diverse decision-making body
better reflects the blend of values and perceptions of a democratic society.
2 Main Part
What I would like to show you today is that values and perceptions can influence
precisely those economic indicators that dominate our decision-making. I will elaborate
this point with two examples, starting with the concept of gross domestic product, or
GDP.
How do we measure economic activities? How do we value them? And what does that
tell us about our value structure?
As a second example, I would like to show you that humans differ in the way they
perceive changes in price developments.
2.1 GDP
Undoubtedly, GDP is one of the most prominent economic indicators. It measures most
1
of a country's output of goods and services over a certain period. The concept follows
the idea of "value added", although it only values certain activities. As a result, the
contribution of a certain economic activity to the country's GDP depends on its market
valuation.
Moreover, while some economic activities count towards GDP, others do not.
Housework, for instance, does not count because it is not exchanged in the market and
not valued in market prices. Doing chores, caring for children or the elderly does not
count either. These kind of activities - largely done by women - do not contribute to the
official domestic product.
To put it differently: They have no "value" in the national accounts. Nevertheless, they
2
are invaluable for the functioning of a society. In addition, whilst abstaining from some
activities can be beneficial from a socio-ecological point of view, avoiding them will also
lower the GDP figure.
Think forgoing air travel or getting your cell phone fixed instead of buying a new one.
So, what is good for the planet and for future generations is not necessarily good for
increasing the GDP number. At least not in the way we calculate GDP today. Simply
put, when looking at a society's welfare, GDP does not reflect the full picture.
There are indices that take a more broad-based approach. Think about the Human
Development Index, which also looks at dimensions such as life expectancy and
education. Or the Gini coefficient, which measures the distribution of income across a
population. Or environmental economic accounting, which measures how the
environment and the economy interact.
Currently, these and other qualitative indicators do not feature prominently in the usual
interpretation of the economy's performance. Still, they do show that the way we look at
the economy matters for which activities we value as societies. This, in return,
influences our decision-making and our wellbeing. That is why I believe that diversity
should matter in economics!
2.2 Inflation expectations
Before we talk about the importance of these findings for decision-makers, let us look at
another example: Namely, inflation expectations.
Central bankers care a great deal about inflation expectations, because they indicate
whether monetary policy is credible in maintaining price stability. What we observe is
that women's inflation expectations tend to be higher than men's - especially in times of
3
sharply rising grocery store prices. Why? The answer is simple: Because women tend
4
to do most of the weekly shopping. As consumers, we observe and focus on the
prices we encounter in our daily routines. These perceptions shape our expectations for
future inflation.
When asked about future inflation, women place a greater focus on perceived food
price inflation than men, who care more about the price developments of transportation
and housing. While central bankers -are generally aware of this "gender expectations
gap", ECB staff - in a recent blog - pointed to a need to gain a better understanding of
how consumers form and update their inflation expectations.
This, they concluded, would not only enhance the analysis of the macroeconomic
implications of monetary policy decisions. It would also bolster the credibility of central
banks, especially when accompanied by a differentiated communication strategy.
3 Conclusion
Ladies and gentlemen,
Policymakers base their decisions on economic indicators. Those indicators reflect
specific values and perceptions. Therefore, it is crucial to involve a diverse group of
people. So, what is the role of HR in this regard?
I see three tasks:
To be aware of the benefits of diversity
To convince your internal clients of those benefits of diversity
And to implement your strategy of diversity in real life.
Let us start!
1
To be precise: "market value of all final user goods and services produced
domestically during a time period".
2
This is also the central theme of Carney, Mark (2021) "Value(s) - Building a Better
World for All Public Affairs".
3
For an empiricial analysis, see D'Acunto, Francesco, Malmendier, Ulrike and Weber,
Michael (2021) Gender roles produce divergent economic expectations, Proc Natl Acad
Sci U S A. 2021 May 25;118(21)
4
Women are more likely to report food shopping as their main responsibility; see Flagg
Lee Anne, Sen Bisakha, Kilgore Meredith L., Locher Julie L. The influence of gender,
age, education and household size on meal preparation and food shopping
responsibilities. Public Health Nutr. 2014 Sep;17(9)
5
See Di Nino, Virginia, Kolndrekaj, Aleksandra and Meyler, Aidan (2022) What drives
inflation expectations of women and men? ECB Blog (europa.eu)