Determinants of Entrepreneurship: Are Women Different?

In this paper we investigate how individual determinants of entrepreneurship - such as age, income, education, work status, skills, access to networks and fear of failure - differ between males and females. We conduct our exercise using individual data provided by the Global Entrepreneurship Monitor (GEM), available for 46 countries, between 2001 and 2004. We test for differences in the characteristics of female and male entrepreneurs and find that female entrepreneurs are slightly older, more frequently at home or not working, lower income and lower educated, and less access to business networks than their male counterparts. As to the determinants of entrepreneurial rates themselves, the main differences across genders are the lower impact of secondary education and the larger impact of skills and fear of failure in female entrepreneurial rates relative to males. Results for entrepreneurship by opportunity and by necessity confirm the larger importance of specific skills for women creating new businesses. Our results suggest that facilitating access to business networks and specific business skills are the most powerful instruments to increase the rates of female entrepreneurship.