Advertisement

Female Entrepreneurship: Do Urban Centers Ease Out the Challenge? An Analysis for Pakistan

  • Syed M. HasanEmail author
Chapter
Part of the The Urban Book Series book series (UBS)

Abstract

Treading on a business venture with the aim to be either self-employed or an employer is a daunting task in a developing economy. The challenges become yet more formidable if you do not belong to the gender that globally dominates the markets. The commonly identified obstacles encountered by female entrepreneurs are wide ranging. Social norms established through culture or beliefs, whereby women often have preassigned roles leave a limited choice for entrepreneurial pursuits. Enterprising women who somehow cross this barrier have yet more challenges to face. Female entrepreneurs usually do not find support from the business networks; it is hard to find mentors or professional support who can guide in the business decision-making process. Also, frequently, women are constrained on account of access to information and credit. The key question here is to find out the policy framework which can make these constraints less binding for female entrepreneurs. Specifically, this chapter attempts to determine if the social norms and economic opportunities prevalent in an urban economy are conducive to the growth of female entrepreneurship. Urban centers, relative to rural areas, offer better educational, training, and financial facilities. Besides, cities are the hub of employment opportunities due to scale and agglomeration economies and provide market linkages necessary for business growth. On the other hand, the high density of economic activity spurs congestion costs which along with greater factor demand may deter entrepreneurship. To empirically test the hypothesis that urban economies facilitate women entrepreneurs, we use data from the Labor Force Survey of Pakistan. As the female entrepreneurial decision is subject to self-selection, we use the Heckman correction in estimation. Statistics and regression results indicate that the proportion of female entrepreneurs is higher in urban parts of districts while controlling for individual and district-specific characteristics. Besides, women entrepreneurs in urban areas earn higher profits. Consequently, a rural-to-urban migration results in welfare improvement of the female entrepreneur.

Keywords

Female entrepreneurship Pakistan Urbanization 

References

  1. Acharya MPM, Acharya B, Sharma S (1999) Women in Nepal: country briefing paper. Asian Development Bank, ManilaGoogle Scholar
  2. Bosma N, Sternberg R (2014) Entrepreneurship as an urban event? Empirical evidence from European cities. Reg Stud 48(6):1016–1033CrossRefGoogle Scholar
  3. Davidsson P (2006) Nascent entrepreneurship: empirical studies and developments. Found Trends® Entrepr 2(1):1–76CrossRefGoogle Scholar
  4. Ellis P, Roberts M (2015). Leveraging urbanization in South Asia: managing spatial transformation for prosperity and livability. The World BankGoogle Scholar
  5. Fritsch M (ed) (2013a) Handbook of research on entrepreneurship and regional development: national and regional perspectives. Edward Elgar PublishingGoogle Scholar
  6. Fritsch M (2013b) New business formation and regional development: a survey and assessment of the evidence. Found Trends® Entrepr 9(3):249–364CrossRefGoogle Scholar
  7. Gibbons R, Katz L (1992) Does unmeasured ability explain inter-industry wage differentials? Rev Econ Stud 59(3):515–535CrossRefGoogle Scholar
  8. Glaeser EL, Rosenthal SS, Strange WC (2010) Urban economics and entrepreneurship. J Urban Econ 67(1):1–14CrossRefGoogle Scholar
  9. Goheer NA (2003) Women entrepreneurs in Pakistan, how to improve their bargaining power. ILO InFocus programme. SEED Geneva and ILO IslamabadGoogle Scholar
  10. Gronau R (1974) Wage comparisons–A selectivity bias. J Polit Econ 82(6):1119–1143CrossRefGoogle Scholar
  11. Heckman J (1974) Shadow prices, market wages, and labor supply. Econometrica 42(4):679–694CrossRefGoogle Scholar
  12. Heckman J (1979) Sample selection bias as a specification error. Econometrica: J Econom Soc 53–161Google Scholar
  13. Krugman P (1991) Increasing returns and economic geography. J Polit Econ 99(3):483–499CrossRefGoogle Scholar
  14. Kahn ME (2009) Urban growth and climate change. Annu Rev Resour Econ 1(1):333–350CrossRefGoogle Scholar
  15. Ming-Yen TW, Siong-Choy C (2007) Theorising a framework of factors influencing performance of women entrepreneurs in Malaysia. J Asia Entrepr Sustain 3(2):1Google Scholar
  16. Pal MS (2001) Women in Bangladesh: country briefing paper. Asian Dev Bank 394:798–821Google Scholar
  17. PBS (2015) Labor force survey. Pakistan Bureau of Statistics. http://www.pbs.gov.pk/content/labour-force-survey-2014-15-annual-report
  18. PBS (2016) Household integrated economic survey. Pakistan Bureau of Statistics. http://www.pbs.gov.pk/content/household-integrated-economic-survey-hies-2015-16
  19. Porter ME (1990) The competitive advantage of nations. Compet Intell Rev 1(1):14–14CrossRefGoogle Scholar
  20. Prasad JK (1998) Development of women entrepreneurship in India–The role of different institutions. Development of women entrepreneurship in India: problems and prospects. Discovery Publishing House, New DelhiGoogle Scholar
  21. Roback J (1982) Wages, rents, and the quality of life. J Polit Econ 90(6):1257–1278CrossRefGoogle Scholar
  22. Roomi MA (2006) Women entrepreneurs in Pakistan: profile, challenges and practical recommendations. Doctoral researcher paper, school of management royal Holloway. University of London, LondonGoogle Scholar
  23. Roomi MA, Parrott G (2008) Barriers to development and progression of women entrepreneurs in Pakistan. J Entrep 17(1):59–72Google Scholar
  24. Rosenthal SS, Strange WC (2004) Evidence on the nature and sources of agglomeration economies. In: Handbook of regional and urban economics, vol 4. Elsevier, pp 2119–2171Google Scholar
  25. Shabbir A (1995) How gender affects business start-up–evidence from Pakistan. Small Enterp Dev 6(1):35–42CrossRefGoogle Scholar
  26. Shabbir A, Di Gregorio S (1996) An examination of the relationship between women’s personal goals and structural factors influencing their decision to start a business: the case of Pakistan. J Bus Ventur 11(6):507–529CrossRefGoogle Scholar
  27. Shane S, Venkataraman S (2000) The promise of entrepreneurship as a field of research. Acad Manag Rev 25(1):217–226Google Scholar
  28. Sinha S (2005) Developing women entrepreneurs in South Asia: Issues, initiatives and experiences. United Nations, Economic and Social Commission for Asia and the PacificGoogle Scholar

Copyright information

© Springer Nature Switzerland AG 2020

Authors and Affiliations

  1. 1.Lahore University of Management Sciences (LUMS)LahorePakistan

Personalised recommendations