This paper investigates the patterns of female entrepreneurship, labor force participation and gender-based segmentation across Indian manufacturing and services sectors. The paper attempts to link the broad changes in these patterns over the last two decades to change in pro-competitive reforms. While some of the imbalances observed are undoubtedly due to discrimination, we use the term “segmentation” because perfect gender balance is not efficient either. Gender-based comparative advantage in certain occupations and group-based specialization imply that workforces will never be perfectly balanced at the plant or industry level. India's enormous imbalances, however, suggest that it is far from the efficient level.

Our paper makes two important contributions to the literature. One, the limited research that does study the ‘gendered’ impact of competition in developing countries mainly investigates the effect on female labor force participation (FLFP) rates, sectoral employment patterns and wage inequality. The focus of our work is to additionally highlight the impact of such reforms on gender segmentation. Specifically, India's work force is highly segmented by gender. For instance, an earlier study on India’s informal manufacturing reveals that 92% of employed women are in female-owned businesses while 97% of working men are employed in male-owned enterprises (Ghani, Kerr and O'Connell, 2014). Said differently, our work describes the extreme inclination of female-led establishments to hire female employees and likewise the tendency of male-owned plants to have a primarily male-dominated workforce. Furthermore, we use a novel index that measures segmentation based on the perspective of an average employee, to additionally offer insights on the role of pro-competitive forces in mitigating segmentation.

Two, most studies on developing countries have employed trade liberalization as a competitive force to study the changes in gender discrimination thereafter. A few studies in the context of developed countries have also focused on domestic banking reforms. Using establishment level data from India, we study the impact on gender-based outcomes and segmentation in both manufacturing and services emanating from a range of pro-competitive reforms including not only India’s mostly exogenous trade liberalization episode, but also industry-specific domestic reforms and infrastructural reforms.

We are not aware of any such studies for developing countries in Africa and/or South Asia. Yet India is a very important laboratory for studying these effects. First, India has a history of discrimination, broadly speaking, be it by gender, caste, or otherwise. Moreover, this matters for India’s economic growth and development. For instance, Khera (2016) finds that an improvement in public provisions (such as better water facilities, sanitation development, and access to electricity) which increases female labor participation by 1.5% would lead to a 1.4% gain in GDP. Lawson (2008) estimates that India’s per capita income could be 10% to 13% higher than under the baseline scenario of unchanged gender inequality in 2020 if the gender gap decreases by 50% from its 2008 value. The widely followed crimes against women in India and the growth of female political set-asides speak to this important struggle of mainstreaming gender parity in India’s growth narrative.

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