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Women Entrepreneurship

Driga, O., Lafuente, E., Vaillant, Y. (2005). Gender differences in entrepreneurial activity: An analysis of Informal Institutional Factors. Working paper presented at the 50th Congress of the International Council for Small Business (ICSB). Washington D.C., United States of America.

Summary:

Since the discovery of women entrepreneurs by entrepreneurship and small business scholars in the mid 70’s (Catley and Hamilton, 1998), research on women’s entrepreneurship expanded and matured considerably (Carter et al., 2001). However, there are some silent areas in the research on women’s entrepreneurship, mostly concerned with how the social world is constructed and how it affects entrepreneurship (Ahl, 2002: 168).

Using a Spanish dataset for 2003 of 4,877 individuals, the objective of the paper is to determine and compare the influence of the informal institutional factors upon the decision to become an entrepreneur among men and women entrepreneurs in Spain . To reach this objective, we focus the analysis on the socio-cultural and institutional approach.

Our results suggest that Spanish women are less likely to become entrepreneurs as compared to men. Although evidence was found that the existence of a social stigma towards business failure negatively influences the decision to create a business, no significant differences were found between men and women on this issue. Also, no significant differences were found between men and women’s propensity to get involved in entrepreneurial activities as a consequence of their perception of social acceptance and social rewards for entrepreneurship.

Findings in the present paper also indicate that in the case of Spanish entrepreneurs, the personal acquaintance of an entrepreneurial role-model exerts a positive impact on the decision to create a business. Moreover, we found that this positive influence of entrepreneurial role models on the decision to start-up a new business is greater for men than for women. This result has important policy implications, as it indicates that in the case of Spain, entrepreneurial role-models have been a stimulating factor explain a larger proportion of men’s entrepreneurial activity than women’s. This result is in accordance with that reported in Delmar and Holmquist (2004: 7), confirming that the lack of role-models can act as an obstacle for women’s entrepreneurial activities. Therefore, this finding gives further arguments for policy makers to design programmes that foster networking between established and potential women entrepreneurs.

Examples of such practices are the Advisory Center for Female Enterprise Starters in Germany, the Women in Focus programme in Norway, and the Women Into the Network Programme in the U.K., all promoting and offering positive entrepreneurial role-models to women entrepreneurs.

Within the literature on gender and entrepreneurship, the variation in men and women’s entrepreneurial activity raised the question of what their determinants are and prompted a series of recent investigations focused on the impact that several factors have on male and female entrepreneurship across countries. While several economic and demographic factors have been previously investigated, the socio-cultural and institutional variables received little attention. Hence, an important contribution of the present paper consists in the insights it offers on the effects that certain informal institutional factors have upon men’s and women’s decision to create a business.

Moreover, we also believe that the results of direct comparisons between countries should be cautiously interpreted due to the different social and economic contexts in each country. Therefore, an additional contribution of this paper is that it offers a separate macro level analysis in a specific national setting,  as it may contribute to a better understanding of the differences (if any) between women’s and men’s entrepreneurial activity and the factors that determine it in each case.

Click here for the entire research paper.