Does religion curtail women during booms? Evidence from resource discoveries

Abstract

Female employment rates vary systematically across the world. Some of the lowest rates are observed in the Middle East and the Arab states. But what explains this pattern? In this paper, we ask whether religion — and in particular Islam — curbs women’s employment during economic booms. To credibly address this question, we combine data on the unanticipated timing of giant oil and gas discoveries with a measure of Islamic prevalence prior to the oil era. Employing a dynamic event study model on a sample of 126 countries, we show that a giant resource discovery depresses female employment by more than two percentage units in Muslim countries. In non-Muslim countries, we find that a discovery has a neutral to positive effect on female participation in the long run. We attribute the loss of female employment in Muslim countries to the presence of religious laws restraining women’s mobility.