Feminist Economics

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A paper under review must not be copied or circulated without permission.

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Policy Exploration around constraining factors of Women

Entrepreneurship: A step towards women empowerment
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Journal: Feminist Economics

Manuscript ID Draft
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Manuscript Type: Articles

Keywords: women empowerment, Women Entrepreneurship, challenges

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L26 - Entrepreneurship < L2 - Firm Objectives, Organization, and

Behavior < L - Industrial Organization, B54 - Feminist Economics < B5 -
JEL codes: Current Heterodox Approaches < B - Schools of Economic Thought and
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Methodology, O10 - General < O1 - Economic Development < O -

Economic Development, Technological Change, and Growth
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Page 1 of 12 Feminist Economics

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3 Policy Exploration around constraining factors of Women Entrepreneurship: A step towards
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5 women empowerment
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9 ABSTRACT
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11 According to Amartya Sen (1992) “Women Empowerment is the ability of women to exercise full
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control over one’s actions and is one of the central issues in the process of development for many
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14 countries in the world today.” Women are empowered when they have the freedom to control and
15 command their own lives. Economic empowerment increases women’s access to economic resources
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and opportunities including jobs, financial services, property, skills development and market
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18 information. One way of ensuring such economic empowerment of Indian women is through
19 'enhanced role of education' or 'enhanced role of entrepreneurship'. This paper aims to focus on the
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20 economic empowerment through entrepreneurship. This study details how entrepreneurship can have
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22 manifold benefits in empowering women than just focusing on their education. It then tries to
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establish the various challenges that Indian women entrepreneurs face to start and run their
24 entrepreneurial ventures successfully. The study finally suggests policy measures, business and
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26 management training, and the promotion of entrepreneurial networking systems, as potential ways to
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27 empower women entrepreneurs and the role played by the government in creating leadership
28 opportunities, in the hopes of bringing women into the mainstream business sector across Indian
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30 economy.
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34 Keywords: Women empowerment, women entrepreneurship, Challenges.
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3 CHAPTER 1: INTRODUCTION
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The Sustainable Development Goals (SDGs), otherwise known as the 'AGENDA 2030', are a
7 universal call for action to end poverty, protect the planet and ensure that all people enjoy peace and
8 prosperity. Out of the seventeen broadly defined SDG's the first five revolve around key issues like:
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Raising the standard of living, Reducing hunger, Accessibility to good health and well being, Quality
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11 education and Gender equality. Achieving these SDGs requires the partnership of governments,
12 private sector, civil society and citizens alike to make sure we leave a better planet for future
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generations (UNDP, 2017).
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16 United Nations has identified that 'Women will play a key role in the attainment of SGD's globally.'
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17 This is due to the fact that successfully achieving these SDG's is directly linked with raising the per
18 capita income in any economy. Since, there exists stark gender disparities, where women participation
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in the labour market remains 24 percent less than men globally, it is the 'Role of Women' that will be
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21 the key in augmenting the per capita income and therefore attaining the first five SDG's (UN Women,
22 2017). Therefore encouraging increased labour force participation by women will make a particularly
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strong contribution to the economic well-being of the family and communities, poverty reduction and
25 women’s empowerment, thus contributing significantly to these SDGs.
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27 There has been extensive literature on women empowerment where enhancing women participation
28 in labour force has time and again been put forward as a policy implication for ensuring high growth
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30 rate for Indian economy. In line with these policy recommendations the Indian Government has
31 introduced various employment plans and schemes especially for Indian women to enhance their
32 participation. Also ample stress has been made over decades on augmenting women accessibility to
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34 jobs as a measure of empowering women and helping them earn a livelihood. However, the Indian
35 government's policies have failed to address problem of women participation by and large till date.
36 This is largely due to the underlying reasons:
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40 i) Even though ample stress has been made on 'increasing women employment level', there exists a
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big gap as limited stress has been made on 'Linking Employment and Employability'.
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44 ii) Also the stress which is laid on 'increasing women employment levels' confines itself to only a few
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traditional roles that are typically identified for women- participation in agricultural labour force,
47 earning livelihood through domestic work or cooking etc. 'No new vocations' have been put forward
48 by and large that engages majority of women with minimum education and some basic employability
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skills like women drivers for cabs, job creation for women through digital literacy: trainers of Paytm
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51 application in their locality so on and so forth.
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iii) Literature also looks at the linkage between 'employment and employability' in a very gender
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55 neutral way. However, 'social' aspects that are embedded in the Indian society may greatly alter this
56 relationship for 'women' as compared to 'men' labor force participation.
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5 These gaps act as food for thought on 'What is it that the policy makers are doing inadequately as
6 they have failed to achieve the desired result of higher women participation.' Based on these gaps
7 this study dwells deeper into the issues related to Indian urban women and lay stress on women
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9 empowerment through entrepreneurship rather than women employment.The subsequent chapter
10 details the importance of women entrepreneurship over simple employment creation for Indian
11 women. Chapter 3 then tries to identify the hurdles that Indian women face for starting their
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13 entrepreneurial ventures. Finally the study concludes with policy implications and suggestions to
14 boost women entrepreneurship among Indian urban women as a catalyst for growth.
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19 CHAPTER 2: IMPORTANCE OF WOMEN ENTREPRENEURSHIP
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21 The modern theory of Income and employment, as put forward by J.M. Keynes (1939), has been a
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23 big contributor to policy making especially in developing economies like India. Keynesian principles
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24 have been widely applied by governmental organisations for the maintenance of 'full employment'
25 levels. The theory of income and employment is an aggregative theory which lumps all markets for
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27 final goods and services into a single 'product market', all financial markets into a single 'money
28 market' and all labour services into a single 'labour market'. The close interplay and adjustment
29 mechanism within these markets according to Keynes maintain full employment in any economy.
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32 In line with the Keynesian theory this study tries to conceptualize the interplay between product,
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33 money and labour market (with reference to women). These complex relations can be better
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35 understood by highlighting the difference and most importantly the simultaneous interdependence
36 between two crucial concepts, 'EMPLOYMENT' and 'EMPLOYBALITY'. For this study let
37 employment be denoted by ‘α’ and employability be denoted by ‘β’, then one can read the following
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relationships:
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41 α = f (β)
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44 This is to assert that 'Level of employment' in any economy is a direct function of 'Employability'.
45 As put forward by Sumantra Goshal (1997), employability as a management philosophy may be
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defined as the initiative, creativity and competencies of any employee that results in employment and
48 governs the overall market performance. It can further be established that the extend of initiative,
49 creativity and competencies that any individual possess is directly a function of their level of
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education and vocational skills, that one possesses.
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3 where λ is defined as the level of education and (δ) is the vocational skills acquired by an individual.
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5 The study lays stress on the importance of (δ): entrepreneurial skills, in enhancing (β): employability
6 which directly affects the generation of wages and salaries through increased (α) employment levels.
7 The study extends beyond just enhancing (β): employability, towards attainting the highest level of
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9 (β)- which is ENTREPRENEURSHIP. In form of identity this relation may be outlined as under:
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11 ε = (β) max
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14 where (ε) is defined as entrepreneurship. However it should not be misconstrued that (ε) can only be
15 attained through the above derived model. There is another route where (ε) can be attained without
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any emphasis on (λ): education or (δ): skill development i.e. through parental business succession.
18 This alternate route of achieving (ε): entrepreneurship is considered autonomous in my study and is
19 treated as exogenous-(ε)0. As a result (ε)0 remains outside the scope of this study.
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22 Given all the above identified relationships it can be clearly ascertained that focusing on women
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entrepreneurship rather than just enhancing women employment may act as a better catalyst for Indian
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growth. This is because women entrepreneurship goes way beyond just rise in income (International
26 Social Survey Programme, 1989). It truly liberates women by providing them freedom and control
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27 over their income. This further entitles women to take decisions around ‘How to spend the income?’
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Focusing on women entrepreneurship as an engine for empowering women also entails a paradigm
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30 shift among women from being ‘job-seekers’ to becoming ‘job-creators’. Also, the subjective and
31 non monetary aspects like respect, social relations in society etc cannot merely be achieved by rise in
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income but only through entrepreneurship. Furthermore, entrepreneurship is the starting point of
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34 ‘Spin Offs’ as motivators for others to enter this circle which further augments growth. Based on
35 these contours one can easy assert the following:
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i) 'IT IS NOT EMPLOYMENT, BUT EMPLOYMENT + i.e.(β) that should be at the heart of policy
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39 making for successfully ensuring high growth levels in India.
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ii) It is going beyond education (λ), that is towards enhanced vocational skills (δ),that truly forms the
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43 engine of sustainable growth.
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46 iii) Going beyond (β) and achieving (β) max i.e. focusing on ‘women entrepreneurship’ should be
47 aimed at to ensure that SDG's are successfully attained by India in the long run.
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50 It is Σ( i, ii) that inflates the generation of income in an economy. But most importantly Σ(iii) that
51 maximises the income generation. This resultant rise in livelihood of women can help in pulling their
52 families out of poverty (SDG 1), reducing hunger and starvation (SDG 2), increased accessibility to
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54 better health care facilities (SDG 3), quality education (SDG 4) and enhanced Gender equality (SDG
55 5).
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Having established the importance of women entrepreneurship in empowering Indian women, we
7 now try to deduce the various socio-economic challenges that Indian women face in establishing their
8 own entrepreneurial ventures. These hurdles that restrict the entry of women in the entrepreneurial
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arena need to be identified and addressed so that efficient degree of women empowerment can be
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11 achieved for Indian women.
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15 CHAPTER3: FACTORS CONSTRAINING WOMEN ENTREPRENEURSHIP IN INDIA
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17 International Labour Organization (ILO) economists Steven Kapsos and Andrea Silberman have
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identified in general three major reasons for the decline in female participation in the labour force:
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20 (a) Growing female enrollment in education, (b) households withdrawing women from the workforce
21 when the family's income level rises and (c) problems with data and the concentration of women in
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areas of the economy where there is little job growth. In India according to data extended by National
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24 Sample Survey Organisation (NSSO), the national average of women participation in labor force is
25 only 20 percent as against 75 percent for men (NSSO,2012).
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27 Similar gloomy figures are portrayed by women in the field of entrepreneurship as put forward by
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29 All India 6th Economic Census Report. The report suggests that majority of women entrepreneurs in
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30 India, work in the unincorporated or unorganized sector which according to NSSO 62nd round,
31 accounts for almost 99 percent of all firms. Currently only around 13.76 % entrepreneurial
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establishments are being run by women entrepreneurs in India (All India 6th Economic Census
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34 Report).
35 Das (2000) in his study tries to categorize women entrepreneurs in developing economies. He asserts
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37 that there are three broad types of women entrepreneurs that emerge among developing nations : (a)
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39 conditions of their families, (b) 'Chance' entrepreneurs, who start their business out of their hobbies
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41 or take up entrepreneurial ventures that are passed down by their family members and (c) 'Created',
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42 or 'pulled' entrepreneurs- who are motivated through entrepreneurship programmes, or ere motivate
43 enough to build their own identity, develop leadership skills, and contribute to society through their
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venture (Brenda Bushell, 2008).
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47 To organize and manage a successful business enterprise with considerable focus, initiative and risk,
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women entrepreneurs in India need to undertake various challenges (Belwal Shweta et al,2014).
50 Indian women over the years have demonstrated great potential as successful entrepreneurs.
51 However, very few in the real world have been able to establish themselves as successful women
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entrepreneurs. In India, the embedded structural and socio-cultural constraints challenge women
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54 entrepreneurs and make it hard for them to realize their potential as leaders in business (Akhouri &
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3 Sengupta, 1988). This chapter details the various challenges that women entrepreneurs endure in their
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5 journey to become successful entrepreneurs:
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7 Access to finance and respect:
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10 ‘Finance’ forms the foundation of any entrepreneurial activity. Therefore, adequate access to financial
11 resources becomes critical for successful entrepreneurship for both men and women (Aldrich and
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13 Zimmer 1986). Financial institutions are often skeptic of extending monetary help to women
14 entrepreneurs for their less credit value and more odds of business disappointment (Mayoux 2003).
15 They likewise face monetary issue because of blockage of assets in crude materials, work-in-progress
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completed products and non-receipt of installment from clients in time. Furthermore, even though
18 women legally hold equal rights to land and property, literature suggests that their ability to exercise
19 these rights and thereof have any access to substantial collateral for a loan is extremely limited. This
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limitation wells up largely due to the cultural and societal institutions embedded in the Indian society
22 for women (Sangroula and Pathak 2002). This unavailability of sufficient capital and access to
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financial resources women felt constrained by the lack of available capital to expand and develop.
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26 Access to formal education:
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In India, women lag far behind in education. Even after 70 years of Independence the female literacy
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30 rates across India portrays a gloomy picture. The low levels of formal education among Indian women
31 are largely attributed to evils like early marriage, extreme poverty and excessive burden of family
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responsibility on women (Alsop and Heinsohn, 2005). Even though women's education and training
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34 has been stressed upon time and again, women's literacy in Indian remains far below that of men
35 (Millennium Development Goals 2007).
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Due to inadequate access to education, Indian women fail to acquire necessary skills and knowledge,
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39 which acts as a cornerstone for establishing a successful entrepreneurial venture. Illiteracy or even
40 low levels of education puts women behind in the race as they are incapable to foresee and act on the
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42 opportunities that they are presented with. Uneducated women entrepreneurs face challenges like lack
43 of awareness around new methods of production and new development of technology available for
44 their company’s growth. Lack of education also blindsides women about the new techniques of
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46 marketing, benefits of networking and other governmental support that largely acts as a catalyst for
47 their growth.
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50 Male Dominant Society
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52 Male superiority is still prevalent in today’s age even though our constitution speaks of equality
53 between all genders. It is a harsh truth but women are not treated equal to men. In India the head of
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the family is generally a man and it is his permission that is required by a woman to enter a business.
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56 Traditional stereotyping of roles specific to gender, categorizes Indian women as being 'home
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3 oriented' (Parasuraman 2001). Traditionally, entrepreneurship has been considered as a male specific
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5 task as women entrepreneurs as considered to be risk averse. Women are generally low risk-takers,
6 due to their primary responsibility for dependents (Goffee and Scase 1985). Women's perception of
7 risk involves loss, danger, ruin, and hurt. Though the risk tolerance ability of women in day-to-day
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9 life is high compared with that of men, in business it is found to be the opposite (Greene 1999).
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12 A male dominant society always keeps looking for ways to put women down and push them towards
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the shadows. This discourages the drive in women to grow and become better versions of themselves.
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15 Specific gender roles define the women in a male dominant society and they are just never able to
16 grow past the frame that has been cut out for them. This hinders their knowledge growth, their dreams
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17 and even their thought process. It makes them believe as well, that they are less than men and only
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19 men can become entrepreneurs and head their businesses. It is a troublesome situation for the society
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20 and even the world if one half of the population is not even trying to grow to their full potential.
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Challenge of work life balance:
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26 As much as we like to believe that women have completely been able to break the glass ceiling and
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27 become more than the roles defined for them by the society, this is not the complete truth. A lot of
28 passionate women are forced to balance their family and their career at the same time because the
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30 household is considered the responsibility of the women. If they keep giving their full attention to
31 their homes, they will not be able to cultivate new and healthy ideas for their businesses as
32 entrepreneurs (Conroy, T. & Weiler, S., 2015). It is vital to understand that the house is a shared
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34 responsibility between the members of the family. Also, women are more emotionally attached to
35 their children and families which overburdens them with a number of additional responsibilities.
36 Running an organization takes a lot of time and energy as well which makes it an equally taxing job
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as taking care of the family (Shweta Belwal, 2012). This basically implies that women have to do
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39 twice the work and this not only takes a physical but mental toll on them as well. This prevents them
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Lack of Self-Confidence
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46 Female entrepreneurs lack the confidence that men working in the corporate sector naturally possess.
47 This is because women entrepreneurs are faced with challenges like limited access to opportunities
48 and underestimation, which puts additional pressure on them to perform better and prove themselves
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50 worthy. However, in this race, they are discouraged at various points and this is what affects their
51 self-confidence. Being a woman entrepreneur, puts women under continuous scrutiny by the society
52 where men, on the other hand, are praised for the smallest of achievements (Dr.G.Malyadri, 2012).
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Furthermore, literature indicates that women's enterprises are largely small in scale and largely works
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3 convincing others to try them. As a result, most of the women undertake what is described as 'comfort
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5 zone movement' - they tend to operate only among clients they know. Products are sold to relatives
6 and their friends, and suppliers tend to be people they know through family or other close connections
7 (Timmons and Spinelli 2006).
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Having identified the core challenges faced by Indian women before establishing their entrepreneurial
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11 venture and also other challenges in running them successfully, the subsequent chapter details what
12 initiatives can be taken up to resolve these issues.
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16 CHAPTER 4: CONCLUSION AND POLICY IMPLICATIONS
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18 United Nations in their UN foundation Report 2015 has identified ‘Women entrepreneurship
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development’ as an essential part of human resource development for nations globally. However this
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21 development of women entrepreneurship is found to be very low in India, especially in the rural areas.
22 As a result any strategy aimed at economic development for Indian economy will be lop-sided without
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involving women, who constitute half of the world population.
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26 Women entrepreneurship has gained momentum in the last three decades with the increase in the
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27 number of women enterprises and their substantive contribution to economic growth.

28 ‘Entrepreneurship’ amongst women has been a recent concern because women have now started to
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30 become more aware of their rights and their work situation. However, the figures of Indian women
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34 families of urban cities.
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36 India being a male dominated society, where women are assumed to be economically as well as
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activities. As a result women entrepreneurs faced lots of problems like lack of education, social
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40 barriers, male dominated society, limited managerial ability, lack of self-confidence etc. This is
41 because women entrepreneurs face many challenges starting from the earliest starting point till the
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42 endeavor capacities. Being a lady itself presents different issues to a woman entrepreneur. The issues
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44 of Indian women entrepreneurs relates to her obligation towards family, society and lion work- all at
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Women entrepreneurs have shown frustration, and referred to lack of capital, male dominance, access
50 to formal education and most importantly striking a wok-life balance as major blocks to their social
51 advancement and leadership within their own family and beyond. As a solution to their financing
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issues, government microcredit as well as private micro finance programmes such as Grameen Bank
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54 replications (for example, Grameen Bikas Bank, Nirdhan Uthan Bank, and Center for Self-Help
55 Development), small farmers' co operatives, credit and savings co-operatives should be initiated to
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3 extend all the financial support necessary. Women also need require flexible financial support
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5 mechanisms. In the absence of coordinated effort among government and other lending institutions,
6 women entrepreneurs cannot be successful (Mayoux 2003).
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The industrial performance of Asia-Pacific region propelled by Foreign Direct Investment,
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11 technological innovations and manufactured exports has brought a wide range of economic and social
12 opportunities to women entrepreneurs. Evidence has unequivocally established that entrepreneurial
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spirit is not a male prerogative. There is a need for changing the mindset towards women so as to
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15 give equal rights as enshrined in the constitution. The progress towards gender equality is slow and
16 is partly due to the failure to attach money to policy commitments. In the words of president APJ
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17 Abdul Kalam "empowering women is a prerequisite for creating a good nation, when women are
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19 empowered, society with stability is assured. Empowerment of women is essential as their thoughts
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20 and their value systems lead to the development of a good family, good society and ultimately a good
21 nation."
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Government has taken various steps for the upliftment of women entrepreneurs in five year plans.
25 However, more needs to be done as women have the potential and determination to setup, uphold and
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supervise their own enterprise in a very systematic manner, appropriate support and encouragement
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from the society, family, government can make these women entrepreneur a part of mainstream of
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3 REFERENCES
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Amartya Sen (1992), “Development as capability expansion”, available at: Commission on the Status
7 of Women (2000), “ Achievement Report”, Report on the forty-fourth session, 28 February-2 March
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12 Akram, Shaheen and Kiyyani. “Socio economic empowerment of women through micro enterprises:
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15 Alsop and Heinsohn. “Measuring empowerment in practice: Structuring analysis and framing
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indicators.” World bank policy research working paper (2005)
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Andersson, T., Formica, P. & Curley, M.G., 2009. Knowledge-Driven Entrepreneurship: The Key to
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20 Social and Economic Transformation, Springer Science & Business Media.
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22 Brenda Bushell, “Women Entrepreneurs in Nepal: What Prevents Them from Leading the Sector?”
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Gender and Development, Vol. 16, No. 3, Gender, Development, and Leadership (Nov., 2008), pp.
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25 549-564.
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27 case of Ethiopia.” Journal of international women studies 10.2 (2008):3.

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Conroy, T. & Weiler, S., 2015. WHERE ARE THE WOMEN ENTREPRENEURS? BUSINESS
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34 Coughlin, J.H. & Thomas, A.R., 2002. The Rise of Women Entrepreneurs: People, Processes, and
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36 Global Trends, Greenwood Publishing Group. Dittmann, M., 2004. In Brief: Women like women
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7 Khaire. “Literature review of the women entrepreneurs and statutory policies.” International journal
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10 Keshab Chandra Mandal (2013), “Concept and Types of Women Empowerment”, International
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14 Kumar, P., 2016. Indian Women as Entrepreneurs: An Exploration of Self-Identity, Springer.
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Mwobobia. “The challenges facing small scale women entrepreneurs: a case of Kenya.” International
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