The effect of the debt burden on women’s economic empowerment

Abstract

Public debt remains a vital instrument for financing development in Uganda. However, the increasing burden of debt servicing raises concerns about its broader socio-economic implications, particularly on women. This study examines, The Effect of debt burden on Women’s Economic Empowerment in Uganda from 1991-2023. Existing literature highlights that debt servicing often limits government spending on sectors that support women empowerment. However specific ways in which the public debt burden negatively affects women empowerment remain underexplored particularly within the Uganda context. Using annual time-series data obtained from the World Development Indicators (WDI) and applying the Autoregressive Distributed Lag (ARDL) approach, the study analyzes both short run and long-run relationships between debt servicing and women’s economic empowerment, proxied by female labor force participation. Our findings show that a 1% increase in debt servicing leads to a 0.29% decrease in women empowerment in the long run and this can be attributed to the pressure that comes with servicing public debt with leads to diverting government resources that would have been allocated to social programs that support women empowerment to debt repayment. Conversely, economic growth and moderate inflation were found to enhance women’s participation in the labor force, while high interest rates, exchange rate depreciation, and capital-intensive foreign direct investment constrained empowerment outcomes. The study concludes that Uganda’s growing debt obligations reduce fiscal space for social investment critical to women’s welfare and productivity. Based on these findings, the study recommends that the government adopts gender sensitive fiscal and debt management policies to ensure that debt servicing does not affect funding for sectors that promote women empowerment. Subject keywords; Debt burden, Economic empowerment, Women