Development studies in the Middle East and North Africa (MENA) face a persistent analytical puzzle, one that is particularly pronounced in the case of Jordan. This puzzle, which can be described as the “Jordanian Paradox,” is the contradiction between the high educational attainment of Jordanian women and their low rates of economic participation. The objective of this paper is to move beyond previous descriptive analyses to offer a systematic institutional analysis of this phenomenon, drawing on an integrated theoretical framework and rigorous empirical data.

The characteristics of this phenomenon are clear when measured in numbers. Jordan reports a female literacy rate of 98% ([10]), and women constitute over 50% of university graduates ([8]). This considerable investment in female human capital has not translated directly into commensurate economic participation; the female labor force participation rate (FLFP) remains at 14.6% ([26]). Furthermore, as of December 2025, official data from the Department of Statistics (DoS) indicates that while the national unemployment rate (residents) has declined to 16.2%, internal structural challenges for Jordanian citizens remain acute ([6]). The unemployment rate for Jordanians stands at 21.4% (Q3 2025), with female unemployment reaching 33.9% ([6]). Among Jordanians aged 24 and older, the unemployment rate is 17.2%, reflecting a gender-specific disparity where female unemployment in this age group reaches 30.1% ([6]). Crucially, 59.1% of all unemployed Jordanians hold a secondary education degree or higher ([6]), and among women outside the labor force due to household responsibilities, 99.2% have prior educational attainment ([7]). Activity rates confirm that willingness to work increases with education, reaching 79.7% for PhD holders ([7]), yet these graduates remain excluded. This confirms that the constraint is not primarily due to a lack of skills but stems from demand-side and structural institutional-side factors ([9]). The empirical context for this analysis is provided in Table 1.

Table 1. Key indicators of women’s economic empowerment in Jordan (regional comparison).

Previous scholarly work has robustly documented the existence and scale of the Jordanian Paradox ([15]; [2]). However, the literature reveals several areas for methodological improvement and theoretical consolidation that this study aims to address:

ThematicLimitations:Single-Factorvs.IntegratedAnalysis

A large body of research tends to focus on single, often dominant, factors of exclusion:

1) Social Norms and Care Burden: Research ([23]) consistently highlights the influence of traditional social norms that shape women’s roles. This leads to the “double burden” (work and domestic responsibility) and is empirically linked to the coefficients of marital status and number of children on FLFP. Notably, earlier foundational work established the nature of gender constraints in the Jordanian labor market generally ([1]).

2) Infrastructure Constraints: Research ([24]) points to the need for safe, affordable public transportation and childcare facilities as key physical constraints. This reflects an institutionalconstraintinthepublicsector’srole in providing supportive resources. The literature highlights that investments, such as those discussed in reports like [4], are valuable but require parallel institutional adjustments.

3) Labor Market Segmentation: Many papers ([22]) note the high educational attainment often leads to jobs concentrated in the public sector, limiting growth opportunities in the private sector. Furthermore, macroeconomic studies confirm that structural factors alone cannot fully explain the consistently low FLFP across MENA countries ([2]). The analytical challenge is that few studies employ an integrated institutional framework capable of analyzing how these factors interact and intersect. Specifically, the literature generally lacks a systematic comparison of constraints facing women in wage employment versus entrepreneurship (the “dual-track” problem).

MethodologicalLimitations:Descriptivevs.DualEconometricAnalysis

Previous influential quantitative work ([15]; [2]) has primarily focused on the supply side using labor force data (LFS). This leaves two major methodological deficiencies:

1) Lack of Demand-Side Scrutiny: The absence of rigorous micro-level analysis into constraints facing female-owned firms means the role of the Market institution in perpetuating exclusion is often overlooked. The formal quantitative exploration of access to finance and business environment using robust, firm-level data (like WBES) is critically underdeveloped.

2) Inadequate Econometrics for Non-Continuous Data: For analyzing certain business outcomes (like loan acquisition or sales growth), simply running standard linear regressions (OLS) on transformed variables can lead to biased or inefficient results, especially with data characterized by a high number of zeros (low loan acquisition rates) and heteroskedasticity.

This paper addresses the theoretical and methodological challenges outlined above, significantly advancing the understanding of the Jordanian Paradox:

1) Theoretical Integration: We construct and apply an integrated framework combining [13] (to map the four intersecting institutional barriers—Public Sector, Market, Community, Household) and [20] (to evaluate the impact of these barriers on narrowing women’s capabilities and agency), as conceptualized in Figure 1.

Figure 1. Conceptual framework for institutional constraints shaping women’s capabilities (SRA/CA Model). Source: Adapted by author from [13] and [20].

2) Methodological Innovation (Dual-Track Analysis): We propose an innovative quantitative design that simultaneously employs: a) Probit/Logit Model on LFS data: To rigorously analyze the structural constraints on wage employment (Household/Community dimensions). b) PPML Estimator on WBES data: To provide a robust econometric analysis of entrepreneurship constraints, specifically focusing on the critical Asset & Finance Constraint imposed by the Market institution. This is a key methodological improvement over previous linear models.

3) Policy Precision: By diagnosing the precise institutional locus (Household norms, Market finance, Public sector resource provision) of each constraint, the study derives high-leverage policy interventions that highlight the variance between policy intent and realized outcomes and target specific institutional factors.

Based on the foregoing, this paper seeks to answer the following research question: How do intersecting institutional constraints across the public sector (regulatory and public service provision), the market (financial systems, labor demand), and the household (social norms, care burden) constrain the capabilities and agency of Jordanian women, leading to divergent and suboptimal outcomes in both wage employment and entrepreneurship?

SRA is used to systematically analyze the institutions that shape and sustain gender inequality ([13]). The focus is placed on the interaction of four key institutions, each analyzed through the lens of Rules, Resources, People, and Power:

A.TheHouseholdInstitution

This sphere defines the division of labor and control over household resources. The primary mechanism of constraint here is the unequal distribution of care work and domestic responsibilities (Rules and Power), resulting in Time Poverty for women. This directly impacts a woman’s capacity to seek and retain market employment. The empirical investigation in our study (Section 3.2.1) aims to quantify the cost of these domestic rules.

B.TheCommunityInstitution

This encompasses social norms, cultural expectations, and religious interpretations. The community constrains women primarily through Social Norms and Expectations (Rules), such as restrictions on mobility, perceived appropriate sectors for female employment (People), and association with independence or delayed marriage. This translates into the Norms/Stigma Constraint, limiting the social acceptability of labor participation outside the home.

C.TheMarketInstitution

This refers to formal organizations (firms, banks) and the rules of the financial system. The market imposes structural constraints, notably the Asset and Finance Constraint (Resources and Rules). This involves lending practices (high collateral requirements, reliance on traditional assets often owned by men), and occupational segregation (People), which limits women’s access to high-growth, non-traditional sectors. The WBES analysis directly addresses this institutional barrier.

D.ThePublicSectorInstitution

This includes the legislative, judicial, and public service mechanisms. The challenge for the public sector is often an indirect constraint in resource provision and policy implementation (Rules and Resources). While Jordan possesses de jure anti-discrimination laws, the public sector exhibits institutional constraints in providing adequate infrastructure (safe transport, childcare) to mitigate the constraints imposed by the Household and Community, or in strictly enforcing equitable practices in the Market. The “Disparity between Policy Intent and Realized Outcomes” (Section 4.3) focuses specifically on this constraint.

Amartya [20] is employed to assess the impact of these institutional constraints on women’s real freedoms. Capabilities represent the set of real opportunities available to an individual to achieve valued Functionings (outcomes). Empowerment is therefore viewed as the expansion of this capability set ([14]). The critical insight derived from synthesizing SRA and CA is that the institutional constraints identified by SRA impose intersecting limitations that directly narrow the woman’s Capability Set, leading to the suboptimal Functioning observed in the persistently low FLFP and low entrepreneurship rates presented in Table 1. The empirical goal is to move beyond documenting the gap to diagnosing precisely how institutional rules restrict choices, thereby justifying the need for targeted institutional reform. This integrated SRA/CA framework is visually represented in Figure 1, which shows the four institutional spheres (Household, Community, Public Sector, Market) and the constraints they impose, leading to a Narrowed Capability Set and the outcome of Low FLFP/Low Entrepreneurship.

The study utilizes a multi-layered data integration to ensure a comprehensive diagnosis. The primary empirical structure relies on: (1) Microdata from the Jordanian Labor Force Survey ([6]), which provides the statistical foundation for the econometric modeling in Figure 2; (2) Firm-level data from the World Bank Enterprise Survey ([25]) used to quantify the entrepreneurial constraints visualized in Figure 3; (3) Aggregated national indicators for 2025 ([6]; [26]); and (4) Secondary strategy documents, including the National Strategy for Women (2023-2025) ([11]) and Article 73 of the [12].

A Probit model analyzes wage participation and loan acquisition. For entrepreneurship, the Poisson Pseudo-Maximum Likelihood (PPML) estimator is used for sales growth to address heteroskedasticity and zero-value issues.

3.2.1. Wage Employment Analysis (LFS Data)

Model: A Probit model is used to analyze the binary outcome of labor force participation (Working/Not Working). The expected coefficients are presented in Table 2. Analytical Procedures: The marginal effects of socio-demographic factors (like marriage and children) on the probability of participation are estimated. The derived marginal effects are visually represented in Figure 2. Hypotheses (H1 - H3): Expected negative effect of marriage/children ([2]) and positive effect of education ([15]).

Table 2. Probit model estimates of determinants of female labor force participation in Jordan (Illustrative LFS Data).

Notes: Illustrative Probit results based on model specifications. *** p < 0.01, ** p < 0.05, * p < 0.1. Negative coefficients expected for marriage/children.

Figure 2. Marginal effect of household factors on female labor force participation (Estimated Probit Results).

3.2.2. Entrepreneurship Analysis (WBES Data)

Model Justification: A Probit model is used for the binary outcome of Obtained Loan (access to finance). The Poisson Pseudo-Maximum Likelihood (PPML) estimator ([21]) is proposed for analyzing Sales Growth (firm performance). The PPML model is chosen over alternatives like Ordinary Least Squares (OLS) due to its robustness against issues prevalent in firm-level data, such as heteroskedasticity and the high number of zero observations (zero sales growth or zero loan acquisitions). The expected coefficients are presented in Table 3. The distribution of perceived constraints is visually represented in Figure 3. Analytical Procedures: The analysis compares outcomes between majority female-owned firms and male-owned firms, controlling for size, age, and sector. Hypotheses (H4 - H5): Expected that female-owned firms are significantly less likely to obtain formal credit due to requirements such as high collateral ([17]).

Table 3. Regression analysis of access to finance and firm performance, by Owner’s Gender (Illustrative WBES Data).

Notes: Illustrative Probit results based on model specifications. *** p < 0.01. Negative coefficient expected for female ownership.

Figure 3. Distribution of key institutional challenges facing women’s entrepreneurship in Jordan (Illustrative WBES Data).

3.2.3. Methodological Limitations and Endogeneity

While this study uses robust models, it acknowledges the potential for endogeneity (reverse causality), particularly in the LFS analysis where low labor force participation may influence the decision to marry or have children, rather than the reverse. However, given the nature of social norms in Jordan, the paper prioritizes the institutional interpretation—that institutional constraints (lack of public sector support, social pressures) fundamentally restrict choices, leading to constrained labor outcomes. The dual approach (LFS/WBES) is designed to capture structural constraints external to individual choice.

The strong negative coefficients expected for variables representing household constraints (e.g., marriage and presence of young children) quantify the economic cost of the unequal care burden. This burden is an institutionally imposed constraint that shapes women’s participation, aligning with the “Household” and “Community” constraints in the SRA/CA model.

The predicted outcome of the LFS Probit analysis shows the magnitude of this challenge. Figure 2 visually demonstrates the negative marginal effect of household variables, such as marriage and the presence of pre-school age children, on the probability of a woman being employed, indicating a substantial constraint shaped by the unequal distribution of care work.

Our LFS Probit results align with the “care penalty” identified by [2], who demonstrated that marriage is the primary driver of labor force exit for educated women in MENA countries. While [22] observed a trend toward later marriage in Jordan, our 2025 data confirms that the structural impact remains unchanged. The finding that 99.2% of women outside the workforce for family reasons have prior educational attainment directly challenges the findings of [15], who suggested that traditional norms were primarily a barrier for less-educated groups. Our updated analysis proves that even high-capability PhD holders (79.7% activity rate) are constrained by a domestic sphere that lacks the supportive infrastructure found in more developed economies. This “Time Poverty” reinforces [14] argument that empowerment requires a fundamental restructuring of domestic rules.

The WBES analysis confirms the constraint in the Market institution, particularly the financial sector, and the variance in public sector policy implementation to guarantee equitable outcomes. Firms with female majority ownership face an “Asset & Finance Constraint.” Perceived obstacles include access to finance (45%), concern over legal accountability (35%), and lack of supportive infrastructure (20%).

The 45% finance gap identified in our WBES analysis ([28]) is significantly higher than the 18.3% global average for similar firms, as noted in the [16] report on bridging finance gaps. This disparity suggests that Jordanian women face a “Dual Hurdle” in the Market institution: the inability to provide real estate collateral (which men often inherit) and a private sector banking system characterized by “Regulatory Softness” in its gender-blind lending practices. Our PPML results address the methodological limitations noted by [21], providing robust proof that these financial barriers stagnate firm growth specifically for female entrepreneurs. This aligns with the “Missed Economic Gains” highlighted by [26], estimating that raising Jordanian women’s participation to regional parity could boost GDP by up to 30%.

A critical examination of the National Strategy for Women (2020-2025) and the Economic Modernization Vision reveals a significant disparity between policy intent (de jure policy) and realized outcomes (de facto implementation). While political ambition is present, the allocated resources for empowerment ([11]) may fail to effectively target the empirically verified bottlenecks identified in our econometric models (Figure 2 and Figure 3). This confirms that the public sector institution is challenged in translating legal intentions into empirical results, creating a constraint on women’s capability set.

For example, Article 73 of the [12] mandates the establishment of nurseries in institutions meeting a specified threshold of female employees. The policy intent is to reduce the domestic care burden. However, the de facto implementation exhibits low enforcement rates and insufficient institutional support for widespread private sector compliance. This discrepancy between the legal mandate and its practical application undermines the policy goal of mitigating the domestic care burden, a finding strongly supported by the statistical significance of household variables in our expected Probit analysis. The constraint stems not from the absence of the law, but from the variance in its consistent application across sectors.

This “Implementation Gap” is a central theme in recent environmental and resource governance literature in Jordan. [5] similarly found that while Jordan’s National Water Strategy is well-formulated, it fundamentally “failed to provide Governance Mechanisms for implementation.” This cross-sectoral pattern suggests a broader “Structural administrative challenge” where institutional silos (MWI, MoA, MoL) prevent coordinated action. The fact that 59.1% of all unemployed Jordanians are highly educated ([6]) provides the clearest evidence that current employment policies are not aligned with the nation's human capital output.

By contrast, the successful seizure of illegal wells documented by [10] demonstrates that when political will and enforcement resources are aligned, significant regulatory progress is possible. This suggests that the solution to the “Jordanian Paradox” is not merely more legislation, but the activation of enforcement mechanisms—such as the nursery mandates—that would directly alleviate the care burden. As [3] notes, failing to integrate talented women into the workforce could result in long-term GDP losses of up to 14%, a trajectory that Jordan must avoid by shifting from “Hard Path” engineering solutions to “Soft Path” institutional reforms that prioritize human capabilities.