The Economic Roots of Empowerment: How Economic Complexity Affects Women's Empowerment

ABSTRACT Understanding the gendered impacts of economic complexity is crucial for inclusive development in Africa. This study investigates the relationship between economic complexity—reflecting the sophistication and diversity of a country's productive capabilities—and women's empowerment across 36 African nations between 1998 and 2022. Women's empowerment is measured through critical dimensions: female vulnerable employment, female labour force participation (FLFP), women's political participation and female employment in industrial sectors. Utilising panel data and robust econometric methods—Panel‐Corrected Standard Errors (PCSE), Lewbel instrumental variable (IV) estimators to address endogeneity and Panel Quantile Regression—the analysis reveals significant and divergent effects. Key findings suggest that economic complexity has a positive influenceon female vulnerable employment and significantly enhances women's political representation. Conversely, it exerts a negative effect on women's employment within industrial sectors. Further analysis using panel quantiles demonstrates that the magnitude and significance of these effects vary substantially across the distribution of each empowerment variable. Crucially, heterogeneity analysis confirms that the positive effects on vulnerable employment, labour force participation and political representation hold consistently regardless of the initial level of economic complexity. However, the negative impact on industrial employment remains persistently detrimental at all levels of complexity. This pattern of results suggests that while economic complexity fosters greater female labour force inclusion and political voice, it simultaneously contributes to the marginalisation of women from formal industrial employment, highlighting a double‐edged sword effect on women's empowerment pathways in Africa.