Gender inclusion and governance: the role of productive capacity

Abstract The purpose of this study is twofold. First, it examines the unconditional impact of gender inclusion on governance in Africa. Second, it investigates the moderating role of productive capacity in shaping the effect of gender inclusion on governance. The study focuses on 51 African countries over the period 2010 to 2022. The empirical strategy is based on two approaches. First, an estimated baseline regression model with the pooled ordinary least squares (OLS) technique. Second, dynamic model estimation through the adoption of the interactive System Generalized Method of Moments (SGMM) estimator to address unobserved heterogeneity and simultaneity-driven endogeneity. For robust policy outcomes, governance quality is assessed using an aggregation of six governance indicators, which are further disaggregated into political, economic, and institutional governance. Similarly, gender inclusion is assessed through female labor force participation, female self-employment, female political representation, and female employment. The findings indicate that enhanced productive capacity mitigates the unconditional negative effect of gender inclusion, thereby fostering improved governance outcomes. Moreover, the study identifies the threshold levels at which this reversal occurs. Other findings and policy implications are discussed in alignment with the African Union’s 2063 agenda and Sustainable Development Goals (SDGs).