Identification of Factors Determining Female’s Labour Force Participation in the World: A Factor Analysis Approach

Year 2025, Volume: 75 Issue: 1, 67 - 96, 14.07.2025

Harun Kaya , Murat Belke

https://doi.org/10.26650/ISTJECON2024-1497745

Abstract

The objective of this study is to identify the factors that determine female labour force participation rates in 87 countries across different levels of development, namely developed, developing, and less developed over the period from 2015 to 2019. To achieve this, the study employs exploratory factor analysis to uncover the underlying factors that explain the determinants of female labour force participation. Exploratory factor analysis is a particularly suitable method, given the absence of a comprehensive, established theory in the literature regarding female labour force participation. Furthermore, this study addresses the theoretical gap by utilising a multidimensional dataset, which includes 20 observable variables covering potential determinants such as economic conditions, health, education, technological infrastructure, institutional frameworks, natural resources, and energy consumption. The findings from the exploratory factor analysis reveal several independent factors influencing female’s labour force partici3 pation, including the level of development of the countries, their reliance on agriculture as a traditional mode of production, their dependence on strategic natural resources, and the extent of renewable energy consumption. The results from the regression analysis using these identified factors as independent variables demonstrate that the level of development and reliance on agriculture as a traditional mode of production have a positive effect on female labour force participation. In contrast, dependence on strategic natural resources is found to have a negative effect. However, the amount of renewable energy consumption did not show a statistically significant impact. These results have important implications for both academics studying gender and labour force dynamics and for policymakers aiming to design effective interventions to increase female labour force participation.

JEL Classification : C18 , J21 , J78 , O3

Keywords

Female Labour Supply, Female Labour Force Participation, Exploratory Factor Analysis

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