Countries like Jordan, which adhere to and follow the reform paradigms
of the Bretton Woods Institutions — namely the International Monetary Fund
(IMF), the World Bank, and the World Trade Organization — hardly ever focus on
assuaging inequalities, including gender inequality, which combine to create
costly deficits in their economies. The government should avoid being labeled
as a creator of inequalities by simply ignoring them in the course of its
avowed compliance to IMF policies.
اضافة اعلان
The Jordanian economy suffered over the last 25 years from a rise in
the numbers of both the extremely poor and the extremely rich. To be fair, this
has also been a global phenomenon. However, in Jordan this was coupled with
escalating challenges caused in part by the lack of emphasis on productivity
and public innovation. Consequently, the economy currently suffers from high
levels of national debt (similar to early 1990s levels), the highest
unemployment rate in the past 30-some years and a 50 percent unemployment rate
among youth, and fast-rising interest rates, where the Central Bank of Jordan
and private banks increased interest rates eight times in the past 12 months.
While economists around the world have been focusing on new streams of economic thinking… Jordanian economic policy remains traditional or orthodox in almost every sense of the word.
Furthermore, even though the COVID-19 pandemic alerted policy makers to
the plight of women and underscored the necessity to address the disparities
they suffer from, it seems that, after a mere two years, the distress call has
ebbed and withered, and even vanished due to neglect, yet again. In spite of an
intellectually active and vibrant civil society that has appeared to gain
strength and make some progress towards diminishing the gender gap, that
progress has remained slow relative to the rest of the world.
Strategic shortcomingsAs a side note, feminist economics is not the only field where Jordan
has failed to win the race. While economists around the world have been
focusing on new streams of economic thinking, such as behavioral economics,
integrating innovation into economic policy and the public policy debate, and
modern monetary theory, Jordanian economic policy remains traditional or
orthodox in almost every sense of the word.
Worse still, the economic debate in this part of the world remains
focused on government budget deficits, and the rising national debt — not on
how and where the money should be spent, or how to bring about equalities where
there are inequalities. What is more, if inflation threatens advanced economies
that pumped trillions of dollars into their economies in a bid for
sustainability as a quick response to COVID-19, Jordan timidly follows the
age-old response of “raise the interest rate”, even though pandemic measures in
Jordan did not come close to those of such economies.
Types of
inequalitiesOn a positive
note, gender inequality in education has been reversed. Jordanian women are now
better-educated than men. However, wage inequality in the private sector has
widened as the gap has increased from 15 percent to 17 percent. Moreover,
Jordanian women still suffer from one of the lowest labor participation rates
in the world.
Children of the poor go to public schools where government spending has been stagnant, insufficient, and inefficient for more than a decade.
Among the other inequalities that
Jordan experiences are spatial income inequalities in urban and rural spheres
as well as at the governorate level. Inequality among governorates, caused by
disproportionate access to infrastructure, education, and health services,
contributes even more to the Kingdom’s total inequality than urban-rural
inequality. This spatial inequality contributes significantly to income
inequality and economic growth imbalances, especially since Jordan lacks an
adequate public transportation system, which results in a daunting lack of
geographic mobility among the poor.
Another inequality is in the realm of education, tied to the wealth and
education levels of parents. Children of the poor go to public schools where
government spending has been stagnant, insufficient, and inefficient for more
than a decade. On the other hand, the children of well-to-do parents attend
private schools, some of which are on-par in terms of quality of education and
fees with the top private schools of the world. Needless to say, this leads not
only to income inequality but also to intergenerational immobility among the
poor, and a no-exit-through-learning status quo. One must caution that such a
state of affairs in education creates a dangerous schism in society that grows
from one generation to the next.
What can the
government do?Part of the solution to Jordanian inequalities is a set of progressive
economic policies. At the education level, such policies include investing in
education and ensuring equal access to services, internet, and social security;
launching awareness campaigns on the benefits of education to reduce the
drop-out rate; and further subsidizing school supplies, conditional on parents’
income and wealth. The government can also impose stricter measures to combat
child labor, offer better-targeted full scholarships to less advantaged
children, and implement a flexible program allowing university students in need
to work on campus to cover some of their expenses.
To encourage local economic development and decrease spatial inequalities, there is an urgent need for a proper public transportation system.
In terms of progressive fiscal policies, a starting point would be a
progressive income tax, avoidance of the IMF prescriptions and paradigms,
income redistribution aimed at reducing wealth inequalities, and a
comprehensive package of public services. The government should also take
measures to combat involuntary unemployment, enhance access to social security,
provide adequate and timely minimum wage laws, ensure that the country has an
effective, first-rate antitrust/competition law, and emphasize spending on
innovation, digital technologies, and artificial intelligence without
undermining job security for the current and future labor force. Finally, to
encourage local economic development and decrease spatial inequalities, there
is an urgent need for a proper public transportation system.
Read more Opinion and Analysis
Jordan News
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