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The importance of capital in closing the entrepreneurial gender gap: a longitudinal study of lottery wins

Author

Listed:
  • Sarah Flèche

    (CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique, CEP - LSE - Centre for Economic Performance - LSE - London School of Economics and Political Science)

  • Anthony Lepinteur

    (uni.lu - Université du Luxembourg = University of Luxembourg = Universität Luxemburg)

  • Nattavudh Powdthavee

    (WBS - Warwick Business School - University of Warwick [Coventry], IZA - Forschungsinstitut zur Zukunft der Arbeit - Institute of Labor Economics)

Abstract
Can capital constraints explain why there are more male than female entrepreneurs in most societies? We study this issue by exploiting longitudinal data on lottery winners. Comparing between large to small winners, we find that an increase in lottery win in period t-1 significantly increases the likelihood of becoming self-employed in period t. This windfall effect is statistically the same in magnitude for men and women; a one percent increase in exogenous income increases the probability of female selfemployment by 0.6 percentage points, which is approximately 10% of the gender entrepreneurial gap. These results suggest that we can causally reduce the gender entrepreneurial gap by improving women's access to capital that might not be as readily available to the aspiring female entrepreneurs as it is to male entrepreneurs.

Suggested Citation

  • Sarah Flèche & Anthony Lepinteur & Nattavudh Powdthavee, 2021. "The importance of capital in closing the entrepreneurial gender gap: a longitudinal study of lottery wins," Post-Print halshs-03472910, HAL.
    • Handle: RePEc:hal:journl:halshs-03472910
    DOI: 10.1016/j.jebo.2021.05.038
    Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-03472910v1
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    as
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    More about this item

    Keywords

    gender inequality; self-employment; lottery wins;
    All these keywords.

    JEL classification:

    • J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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