Key sectors for gender pay gap reduction: a multiplier effects analysis for Chilean economy

Recently, the Chilean government embarked on a phase of redefining fiscal policies with the aim of addressing gender pay equity (Equidad Salarial). In this context, this paper emphasizes the crucial role that a disaggregated and general equilibrium approach can play in supporting the Chilean policymakers, particularly in the formulation of policies for the reduction of gender pay gap in specific sectors and the integration of female employment. The analysis is carried out using a gender Computable General Equilibrium model based on the gender Social Accounting Matrix for Chile. The simulations reproduce an expansion of final demand for investment by commodity under different assumptions on the elasticity of substitution between male and female labour. The results suggest that some productive sectors, more than others, have aptitudes to reduce the gender pay gap and stimulate employment and economic growth, if stimulated by fiscal policies.