Contract Design, Business Growth, and Female Entrepreneurship: Evidence from Microfinance in India
Low average returns of female-run enterprises reflects the fact that women鈥檚 capital is typically invested into their husband鈥檚 enterprise
Abstract
Several field experiments find positive returns to grants for male and not female micro- entrepreneurs. But these analyses overlook that female entrepreneurs often reside with a male business owner. Using data from randomized trials in India, Sri Lanka and Ghana, the authors show that the gender gap in microenterprise performance is not due to a gap in aptitude. Instead, low average returns of female-run enterprises reflects the fact that women鈥檚 capital is typically invested into their husband鈥檚 enterprise. Household-level income gains are equivalent regardless of the grant or loan recipient鈥檚 gender.
This research was funded under the Private Enterprise Development in Low Income Countries (PEDL) Programme
Citation
Field, E., Pande, R., Rigol, N. (2017) Contract Design, Business Growth, and Female Entrepreneurship: Evidence from Microfinance in India, PEDL.
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