How do female entrepreneurs perform? Evidence from three developing regions
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Using the World Bank Enterprise Survey data, we analyze performance gaps between male- and female-owned companies in three regions—Eastern Europe and Central Asia (ECA), Latin America (LA), and Sub-Saharan Africa (SSA). Among our findings are significant gender gaps between male- and female-owned companies in terms of firm size, but much smaller gaps in terms of firm efficiency and growth (except in LA). Part of the reason women run smaller firms is that they tend to concentrate in sectors in which firms are smaller and less efficient (in ECA and SSA). By contrast, we find no evidence of gender discrimination in access to formal finance in any of the three regions, although in ECA women are less likely than men to seek formal finance. Finally, while female entrepreneurs receive smaller loans than their male counterparts, the returns from each dollar they receive is no lower in terms of overall sales revenue.
KeywordsEntrepreneurship Gender Finance Latin America Eastern Europe and Central Asia Sub-Saharan Africa
JEL ClassificationsD24 J16 L25 L26 M21 O16 O54
We acknowledge the support of the PREM Gender group at the World Bank for funding this research. We would like to thank Andrew Morrison, John Jackson, and Jan Svejnar for discussions that significantly improved the paper. Thanks are also due to two anonymous referees and the participants to the Workshop ‘Female Entrepreneurship: Constraints and Opportunities,’ which was organized by the World Bank in Washington D.C. on June 2 and 3, 2009, and to the ‘5th IZA/World Bank Conference: Employment and Development,’ May 3–5, 2010, Cape Town, South Africa, for useful comments and suggestions.
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