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Investing in Women’s Human Capital


By Arina Kharlamova, Staff Writer

Give a man a fish and you feed him for a day. Teach a man to fish and you feed him for a lifetime.  –Chinese Proverb

This ironically accurate proverb is proving to be consistent within research about the empowerment of poverty-stricken women through business, considering that China is one of the countries taking great pains to educate its female population. 

Since microfinance (MFI) was originally established “to ensure that 175 million of the world’s poorest families, especially women, receive credit for self-employment and other financial and business services,” it is heartening to confirm that the various programs are exceeding expectations.  Studies show that 84% of the 113.3 million people receiving microloans in 2005 were women.


[pullquote]A woman that is disenfranchised, homebound, and uneducated cannot start a business, advise a policy, or support her family.[/pullquote]

 A woman that is disenfranchised, homebound, and uneducated cannot start a business, advise a policy, or support her family.  That woman will not gain skills, knowledge, or experience with handouts from non-government organizations.  But a study published in World Development by Bert D’Espallier and associates states that micro-financial investments in women, more so than in men, profit from better repayment performance, lower credit risk, and a “share-the-wealth” mentality that trickles down first to families, and finally to larger communities.  This means that educating women about business practices will end up rewarding both investor and investee more than handing out food or cash will.

In India women, when educated, are more active and more productive in the economy of their country.  “Men’s wage labor supply tends to be relatively unresponsive to increases in education,” writes Paul Shultz in his book Investment in Women’s Capital, while “women with more education supply more of their time to market work.”

[pullquote]Teach a woman to read, and you have a teacher. Give a woman an education, and you have inspired a community. Provide her with resources, and you have enabled a thriving economical entity.[/pullquote]

It has also been shown that countries with stronger laws of education and less gender disparity (like China) make the most economic use of socially mobile and educated women.  No country with a primary education enrollment level of less than 10% has been able to improve its Gross National Product (GNP), but certain countries that have been able to boost enrollment to 20-30% were able to improve their GNPs at least 8% to 16%, writes G.  Balatchandirane, senior lecturer at the University of Delhi.  Investing in women, whether literally with micro-loans or fundamentally by providing education, will always pay off.

Teach a woman to read, and you have a teacher.  Give a woman an education, and you have inspired a community.  Provide her with resources, and you have enabled a thriving economical entity.

ARB Team
Arbitrage Magazine
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