International Journal of Gender and Entrepreneurship

Financial self-efficacy among women entrepreneurs

Frances M. Amatucci Daria C. Crawley
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International Journal of Gender and Entrepreneurship, Vol. 3 Iss 1 pp. 23 - 37
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RUNNER-UP – ICSB-NWBC AWARD 2010 Financial

self-efficacy
Financial self-efficacy among
women entrepreneurs
23
Frances M. Amatucci
School of Business, Slippery Rock University, Pittsburgh,
Pennsylvania, USA, and
Daria C. Crawley
School of Business, Robert Morris University, Pittsburgh,
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Pennsylvania, USA

Abstract
Purpose – As the number of women businesses owners grows worldwide, it is increasingly
important to understand the factors which contribute to their success. While entrepreneurship
research identifies access to human and financial capital as being important, fewer studies explore the
role of sociocognitive factors such as self-efficacy or confidence in one’s abilities to perform a
particular task. This paper aims to examine gender-related attitudes toward financial management
drawing from existing studies education, cognitive psychology, and entrepreneurship.
Design/methodology/approach – The empirical study creates a measure of financial self-efficacy
(FSE) and highlights the importance of age and racial differences among experienced, nascent and
aspiring women entrepreneurs. Firm and individual-level data were obtained from a web survey and
subsequent factor analysis and analysis of variance statistical methods utilized.
Findings – Empirical findings only partially attest to the lack of confidence combined with anxiety
about dealing with financial management. Age and racial differences are significantly related to FSE.
Research limitations/implications – Sample size is relatively small and geographically
concentrated.
Practical implications – The paper suggests the need for more research regarding women
entrepreneurs and their confidence with regard to financial management. It also suggests the need for
possible interventions for women entrepreneurs to increase FSE.
Social implications – This research examines gender differences with regard to learning
math/financial management subjects and the potential need for single-gender entrepreneurial
training programs that focus on finance-related activities.
Originality/value – The paper developed a construct for FSE that is robust and significantly related
to age and racial differences.
Keywords Women, Gender, Entrepreneurs, Financial management, Skills training, Self esteem
Paper type Research paper

I. Introduction
Women are increasingly turning to entrepreneurship and small business ownership as a
path to economic empowerment and personal growth. In 2008, there were an estimated
10.1 million firms in the USA that were women majority owned (50 percent or more), up International Journal of Gender and
from 7.7 million in 2006; they employ 13 million people, generate $1.9 trillion in Entrepreneurship
Vol. 3 No. 1, 2011
pp. 23-37
q Emerald Group Publishing Limited
The authors would like to gratefully acknowledge the comments provided by the journal 1756-6266
reviewers and Dr Susan Coleman, Professor of Finance, University of Hartford. DOI 10.1108/17566261111114962
 IJGE revenues, and represent 40 percent of all US firms. According to the Center for Women’s
3,1 Business Research (2008), women own 20 percent of all firms exceeding $1 million in
revenues.
A number of researchers have addressed the success factors for small firms; typically
these include a combination of human/social and financial capital (Caputo and Dolinsky,
1998; Chandler and Hanks, 1998; Carter et al., 1997). Successful entrepreneurs tend to
24 have education, training or work experience in their target industry, and are able to
secure sufficient capital for start-up and for ongoing operations. However, less
frequently mentioned is the role of sociocognitive factors in the success of small firms.
Attitudinal factors include such things as a willingness to embrace the entrepreneurial
lifestyle with all its attendant risks, persistence and drive, and probably most important,
self-efficacy, i.e. confidence in oneself and one’s own abilities. These are characteristics
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that emerge in almost any case study of a successful entrepreneur, yet the literature does
very little in the way of defining or measuring these characteristics. This research
focuses on one of these characteristics – the role of self-efficacy with regard to financial
management – and explores prior research that may provide insights. Possibly one of
the less glamorous aspects of entrepreneurship, financial management is necessary for
the successful launch and operation of a small firm. Weakness or discomfort in this area
of management may translate into neglect of key areas or errors in judgment that can be
fatal to the firm. Thus, the key research question addressed in this paper is:
RQ1. How does self-efficacy, as related to financial management, influence
entrepreneurial success among women entrepreneurs?
The article is organized as follows: first, we examine existing research in education,
cognitive psychology, and entrepreneurship that may reveal evidence of self-efficacy
and achievement in math-related subjects and/or financial management. Second, we
describe an exploratory empirical study examining women entrepreneurs and their
attitudes towards math-related topics and financial management. Finally, we discuss
the conclusions from this analysis and implications for future research.

II. Literature review

Education
Although relatively few articles from prior research specifically address women
entrepreneurs’ attitudes toward finance, there are several articles in education that
examine the attitudes of girls and women toward quantitative disciplines in general.
These reveal that women’s anxiety about quantitative subjects and lack of confidence
in their abilities to deal with quantitative matter begins at a relatively early age. This,
in turn, influences their performance in quantitative courses, their selection of a college
major, and their ultimate career choices.
Altman et al. (2007) summarize a large body of research conducted globally
examining girls’ academic achievement and their academic self-concept. Although girls
are at parity with boys with regard to academic achievement in math and science in
elementary school, their academic self-concept becomes less positive in middle school
and continues to decline through high school. This growing perception of incompetence
influences academic achievement in math and science subjects, and it becomes
important as girls mature and make career choices.
 Several studies have noted the link between women’s level of anxiety and their Financial
attitudes toward and performance in undergraduate courses in economics. Jensen and self-efficacy
Owen (2001) surveyed almost 2,000 college students attending 34 liberal arts colleges
in the spring of 1999. They found that women entered economics with lower levels of
math ability and lower overall self-confidence. Correspondingly, they found that
women received lower grades in their economics class. They also found that men were
less likely to become discouraged and more likely to continue in the field of economics. 25
The authors noted, however, that women were more likely to be encouraged if they had
a female instructor.
In a similar study, Benedict and Hoag (2002) surveyed undergraduate students, both
male and female, in introductory economics classes at a large US university to find that
females were almost twice as likely as males to respond that they were apprehensive
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about the course. This was true even controlling for the students’ level of math ability
and college major. Benedict and Hoag (2002) also found that women earned lower grades
than men in the course on average, possibly a self-fulfilling prophecy. They postulated
that women may be more anxious because they lack confidence in their technical
abilities, fear that they will not do well in the course, or experience a less welcoming
environment in the classroom.
Ballard and Johnson (2005) surveyed undergraduates enrolled in an introductory
microeconomics course at another large US university. They found that women in the
course were less optimistic about their ability to succeed, even controlling for family
background, academic experience, and mathematics experience. Men anticipated
significantly higher grades in the course than women. When performance was compared
to expectations, however, women actually scored higher than men controlling for the
factors noted above. The authors observed that women’s negative expectations may
influence their willingness to take additional courses in economics and their ultimate
career selection.
Other studies have focused on the ways in which women’s discomfort with
quantitative material influences their career choices, in some instances closing them out
of potentially rewarding career opportunities. Turner and Bowen (1999) noted that within
the science and engineering fields, differences between men and women in terms of
choice of major have not lessened in the past two decades. Rather, the gap between men
and women majoring in math, engineering, or the physical sciences has actually
widened. In response to this, Turner and Bowen (1999) conducted a study of students
from 12, highly selective, undergraduate institutions. They found that women were
over-represented in fields such as nursing and education, while men were over-represented
in math, engineering, and the physical sciences. Additionally, the higher the math
SAT score, the greater the probability that the student would major in some field other
than the humanities. For women, however, those with high math SAT scores were still
much more likely than men to choose a major in either life sciences or the humanities.
Turner and Bowen concluded that differences in SAT scores account for only part of the
gap between women and men in choice of major. The rest is due to other factors which may
include personal preferences, labor market expectations, and cultural and societal factors.
Using data from the National Educational Longitudinal Study initiated in 1988,
Correll (2001) obtained a sample of 25,000 eighth-grade students who were reassessed
every two years through high school and into college. After surveying these students in
college, she found that males were more likely than females to believe that they were
 IJGE competent in math in spite of the fact that math grades and test scores for the two groups
3,1 were similar. Also, there was a large gap between the number of men and women
selecting a quantitative major with only 4 percent of the women majored in engineering,
math, or science, compared to 12 percent of males. Correll (2001) noted, however, that
women who had enrolled in calculus had a significantly higher likelihood of enrolling in
a quantitative major. It may be that having taken calculus raised the women’s level of
26 self-confidence in their math abilities. Alternatively, it may be that women with higher
levels of math ability to begin with self-selected into calculus and quantitative majors.
Correll (2001) hypothesized that women and men take different career paths, not due to
differences in ability, but rather due to cultural beliefs about gender and mathematics,
with mathematical tasks and competence often being stereotyped as masculine. She
noted that this is a particular problem for women, since mathematics is a critical
gateway to careers in math, science, and engineering.
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Also using the National Educational Longitudinal Study, Staniec (2004) investigated
choice of college major and, like Correll (2001), he found that female students were
significantly less likely than males to enroll in science, engineering, or math majors, even
controlling for other factors such as math ability and other individual, family, and school
characteristics. He noted, however, that students who excelled in math and science were
significantly more likely to choose majors in those fields. Women are less likely to
receive degrees in engineering, the physical sciences, math, and computer sciences. The
percentage of women receiving advanced degrees in those fields is even lower. This, in
turn, affects the earning power of women graduates.
Catalyst’s survey of MBA graduates found significant differences between women
and men’s perception regarding the impact of math abilities and confidence on
entrance into MBA programs. Women respondents were more likely to indicate that a
lack of confidence in their math abilities deter women from entering MBA programs,
whereas only 19 percent of male respondents indicated that a lack of math ability
confidence deters men from entering MBA programs (Catalyst, 2000).
Building on the Altman et al. (2007) study described earlier, recently there has been
a strong push toward single-sex classrooms. Based on scientific evidence concluding
that boys and girls learn differently, advocates propose that single-sex settings can
help break down stereotyping at early ages. The goal is to help girls improve their
academic performance in math and science and help boys improve their reading and
writing (Weil, 2008; Perlman, 2008; Sax, 2005). However, a separate and contradictory
study funded by the national science foundation (NSF) tested seven million students in
ten states in the USA in 2000 and concluded that the gap between boys and girls
regarding math scores had closed, although the stereotype prevails (Hyde et al., 2008).
The research in education on gender and performance in math-related subjects is
deeply rooted in two related concepts from cognitive psychology – stereotype threat
and self-efficacy. In this article, we examine more closely the role of self-efficacy with
regard to financial management.

Self-efficacy
The term “self-efficacy” was first introduced by Bandura (1977) in social learning theory
and refers to one’s confidence in ability to perform a particular task. Ten years later, it was
introduced to the organizational behavior literature and was found to be associated with
work-related performance, faculty research productivity, career choice, and learning and
 achievement (Gist and Mitchell, 1992; Gist, 1987). Self-efficacy and stereotype threat are Financial
related in that negative stereotypes may erode confidence (perception of self-efficacy) and self-efficacy
create a self-fulfilling prophecy that an individual is incapable of performing a task. In a
study of US teens, Marlino and Wilson (2003) found that girls had lower confidence
(self-efficacy) in math and finance than boys. In entrepreneurship research,
“entrepreneurial self-efficacy (ESE)” has been examined and is described in the next
section. 27
Entrepreneurship
This phenomenon may be particularly salient as the number of women entrepreneurs
continues to grow. While these numbers continue to rise, women-owned business are
still faced with obstacles such as start-up capital and access to networks. Many
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researchers question whether or not these obstacles are real or simply negative myths
surrounding women entrepreneurs.
A small number of studies have focused specifically on the attitudes of women
entrepreneurs toward quantitative tasks, and, in particular, financial skills and
financial management. Pellegrino and Reece (1982) did extensive interviews with
20 women small business owners in Norfolk, Virginia to find that financial management
was one of the greatest areas of concern. About 60 percent of the women perceived that
controlling expenses, cash-flow planning, and forecasting were major problems. In
general, these business owners expressed the belief that financial management was an
area of weakness and indicated that they wished they had more skill in that area. Hisrich
and Brush (1984) conducted a study of over 1,000 women entrepreneurs in 18 states to find
that they also considered financial skills to be their greatest area of weakness. Lack of
financial training was one of the biggest problems cited during the start-up phase, and
even after the business was established, women entrepreneurs continued to cite lack of
experience with financial planning as a major problem.
Based on an extensive review of prior research, Brush (1992) found that women
entrepreneurs typically had different educational backgrounds than men entrepreneurs.
They were much more likely to have undergraduate degrees in liberal arts as opposed to
business, engineering, or more technical subjects. Brush also observed that the financial
aspects of starting a venture were the biggest obstacles for women. These include
obtaining financing and credit, cash flow management, and financial planning. Finally,
women’s self-assessed competence in their own financial skills was lower than that of men.
Investigating the behaviors of Anglo and Hispanic men and women aspiring to
entrepreneurship, Jones and Tullous (2002) surveyed 133 clients of a regional small
business development center who participated in a training program in 1995. Findings
revealed that both Anglo and Hispanic males perceived that they needed less help in
the financial area than Anglo and Hispanic females. When the consultants who worked
with these pre-venture entrepreneurs were surveyed, however, it was their perception
that women actually needed less assistance in the financial area than men. Thus, the
women had a lower estimation of their financial abilities than the consultants who
worked with them to help them establish their businesses.
In a follow-up to the Diana Project, Brush et al. (2004) address the question “Do women
(business owners) have the requisite financial knowledge, skills and experience?” They
acknowledge that historically women were less likely to study mathematics, finance,
and accounting but, contrary to the aforementioned research, they assert that times have
 IJGE changed. Citing 1998 statistics from the NSF, there is evidence that female high-school
3,1 graduates were more likely than males to have taken geometry, algebra II, and
trigonometry, and almost as likely to have taken calculus. They state “the math skills
hurdle is one of perception (emphasis added) rather than reality, yet its persistence
continues to plague women seeking capital.”
Several studies in entrepreneurship have investigated the relationship between ESE
28 and the intention to start a new venture (Wilson et al., 2007, 2009; Barbosa et al., 2007;
Zhao et al., 2005; Boyd and Vozikis, 1994). ESE is a measure of the confidence an
individual has in one’s ability to be an entrepreneur. Wilson et al. (2007) examined the
relationships between gender, ESE and entrepreneurial intentions among adolescents
and MBA students. ESE was measured with a six-item self-assessment five-point Likert
scale that included “being able to solve problems,” “making decisions,” “managing
money,” “being creative,” “getting people to agree with you,” and “being a leader.”
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Given the increased attention toward ESE as an explanatory variable for

entrepreneurial intentions, McGee et al. (2009) further refined the construct by
developing a multi-dimensional measure of ESE. The ESE construct is consistent with
Bandura’s (1977, 1997) assertion that self-efficacy has greater predictive power when it
is domain specific. Few studies have further disaggregated the ESE construct
(managerial, marketing, financial, etc.) but there is some research to support that even
ESE may be too general and, therefore, less rigorous than concentrating on some of its
core dimensions (Barbosa et al., 2007; Mueller and Goic, 2003).
In a qualitative comparison study of men and women in New Zealand, Kirkwood
(2009) examined the differences in self-confidence between the two at start-up and during
periods of sustained entrepreneurship. Results suggested that women entrepreneurs had
lower levels of self-confidence at both stages having “implications for business growth
and access to finance particularly.” However, self-confidence in women entrepreneurs can
increase after being in business over time.

III. Research methodology

In this research, we disaggregate ESE by examining the role of self-efficacy in financial
management. Our construct corresponds to “managing money” in the Wilson et al.
(2007) and “implementing financial” items in the McGee et al. (2009) ESE construct. To
explore the attitudes of women entrepreneurs’ financial management, we collected data
via the internet using the electronic survey instrument “SurveyMonkey.” The research
team attempted to adhere to the principles for constructing web surveys outlined in
Dillman (2000). The survey was initially administered to three FastTrac-NewVenture
cohorts of women entrepreneurs, and then a convenience sample of women
entrepreneurs. We elected not to collect a comparative male sample since the research
objective is to understand women entrepreneurs’ views and not how they compare to
men (Ahl, 2006, 2004). To increase the sample size, we utilized the snowball technique by
leveraging our professional contacts and networks. Firm-level questions solicited
information about how long respondents owned their business, type of business, how
they acquired their business, number of employees, annual sales, profitability, and
sources of funding. Individual-level questions asked for information about the
respondents’ financial management skills, attitudes toward quantitative academic
courses, awareness of the perception that women are not proficient in financial
management, education, age, and race.
 IV. Results Financial
Of the 51 respondents, 47.1 percent owned their businesses for less than five years and
63.0 percent were start-ups. These percentages only include respondents who started
self-efficacy
their businesses themselves and not with a partner or family member. Three quarters
(74.5 percent) had never owned a business previously, and more than half (53.9 percent)
had no full-time employees other than themselves. Of the 37 respondents who had a
business that was up and running, 35.3 percent reported annual sales of $50,000 or less 29
and over a third indicated that their business was profitable. Respondents were
primarily spilt between the following two age groups 40-49 (39.2 percent) and over
50 (37.3 percent). Additionally, over a third had a graduate degree (39.2 percent). While
the majority of the respondents identified themselves as white, over a third of the
respondents identified themselves as women of color (i.e. African American or
Hispanic) (35.2 percent). Sample sizes and percentage of respondents on study
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variables are presented in Table I.

The comments below summarize responses to an open-ended question regarding
attitudes and past experiences with math-related topics and current level of confidence
with their financial management skills:
For some reason I tend to shut down when it comes to worksheets, financial spreadsheet, etc.
I don’t believe I have a fear of mathematics. I’ve never really been interested. However, I do
realize the importance of good financial management in running a successful business so that
is the reason I’ve joined FastTrac.
I am an older adult who has recently realized I have a learning difficulty which most likely
caused me to struggle with math in school. I am actually pretty proficient but did poorly
in school. My MBA program helped a lot with confidence and competence in financial
matters.
I’m “right brained” so, while I manage my records and ledger system, I do rely somewhat on
advice/assistance from my husband regarding financial management for my business.
In high school I didn’t care very much for algebra, but I never had a problem with courses
involving everyday math, such as bookkeeping or other business courses. As a matter of fact,
I really enjoyed bookkeeping.
Awful; intimidating;
I love math and math-related subjects. On the other hand, financial management has always
been somewhat tedious for me.
My confidence level is growing day by day the more I research and talk with other business
owners. I do feel fortunate that my partner/husband has a finance background and is able to
help a lot! However, I want to be proficient on my own.
I enjoyed math and saw it as essential to any field. I am confident I can maintain my company
at a profitable level.
I understand how to determine cost of business and gross vs net. So I do understand the
basics of business math.
I received good grades in math-related subjects, but didn’t enjoy them as a student. Currently
I’m in the learning phase. I know I can do it. I just need to try to stay awake when I look at the
numbers. It really bores me.
 IJGE Variable n %
3,1
How many years have you owned your business?
Do not have business yet 9 17.6
Less than five years 24 47.1
More than five years 18 35.3
Excluding yourself, how many full-time employees does your firm have?
30 0 27 52.9
,3 9 17.6
4-5 5 9.8
6-10 1 2.0
. 10 2 3.9
What is the level of the firm’s annual sales?
, $50,000 18 48.6
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$50,000-$100,000 9 24.3
Over $100,000 10 27.0
When you subtract all expenses from revenues, is the firm profitable?
No 15 42.9
Yes 20 57.1
Prior to owning this business, how many years of experience did you have working in a business?
0 years 4 8.0
, 5 years 7 14.0
5-10 years 16 32.0
More than 10 23 46.0
How would you rate your skills in financial management?
I do not have any financial management skills 3 5.9
This is an area of weaknesses for me 15 29.4
Adequate skills for my business 17 33.3
Very good 13 25.5
Excellent 3 5.9
How confident do you feel about your skills in financial management?
No confidence 1 2.0
Not very confident 9 17.6
Somewhat confident 23 45.1
Confident 14 27.5
Very confident 4 7.8
How confident do you feel about your abilities to undertake the successful financial management of
your company?
Not very confident 2 3.9
Somewhat confident 18 35.3
Confident 20 39.2
Very confident 11 21.6
Have you ever encountered the perception that women entrepreneurs are not proficient regarding
financial matters?
No 15 46.9
Yes 17 53.1
If yes, to what extent do you agree with that perception
No extent 14 36.8
Table I. A little extent 4 10.5
Sample size and Some extent 15 39.5
percentage of A large extent 4 10.5
respondents on study A great extent 1 2.6
variables (continued)
 Variable n %
Financial
self-efficacy
What is your highest level of education?
Completed high school or equivalent 5 9.8
Some college 8 15.7
College degree 18 35.3
Graduate degree 20 39.2 31
What was your attitude regarding courses which were quantitative or math oriented in high school
and/or college
I tried to avoid them 6 12.2
I did not like them but took them because they
were required 18 36.7
I was indifferent 8 16.3
I enjoyed them very much 14 28.6
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I tried to take as many math and quantitative

course as possible 3 6.1
Race
White 32 64.0
Person of color (i.e. African, American or Hispanic) 18 36.0
Age
Under 30 years 2 3.9
30-39 years 10 19.6
40-49 years 20 39.2
50-59 years 15 29.4
60 years or older 4 7.8 Table I.

I grew to enjoy math in high school once I had a teacher who really took the time with me.
And then in college, as a science major, I took more math and often enjoyed it. Somehow this
doesn’t translate positively into financial management. I have a bookkeeper. The survival of
my store depends on better fiscal management.
I did not do very well in Math in HS and College, (I was an average student) but I understand
it enough to be confident in my ability to run my company.
In the anecdotal comments, it is noteworthy that many respondents had difficulty with
math-related subjects in school, but enjoys the bookkeeping function for their firms.
This suggests a disconnect between women’s experience with math-related academic
subjects and financial management within the context of their companies. Although
several consider finance to be uninteresting and boring, they are confident that they
have the ability to learn what they need to know and, if not, they will get outside
assistance. The Center for Business Women’s Research states that two-thirds of all
women business owners with firms with over $1 million in revenues seek outside
assistance for financial advice (Center for Women’s Business Research, 2006).
With regard to rating their skills in financial management, the sample was almost
evenly divided into three groups; about a third indicated that this was an area of
weakness for them (29.4 percent), a third indicated that they had adequate skills
(33.3 percent) and slightly less than a third perceived their skills as very good or
excellent (31.4 percent). In evaluating confidence in their financial management skills,
about a fifth of the women had no confidence or little confidence (19.6 percent), while
more than a third (35.3 percent) were confident or very confident, and the majority being
somewhat confident (45.1 percent). Moreover, when asked about their confidence
 IJGE regarding their abilities to undertake the successful financial management of their
3,1 company, slightly over a third of respondents (35.3 percent) were somewhat confident in
their abilities, with the majority (60.8 percent) either confident or very confident in their
financial management skills. When asked to describe their attitudes towards quantitative
subjects in high school or college, almost half of the respondents (48.9 percent) said they
avoided them or did not like them. Conversely, over a third (34.7 percent) stated that they
32 enjoyed quantitative subjects and/or took as many as possible. Of the 51 respondents, over
half (68.0 percent) took care of their family finances alone. Additionally, over a fifth
(22.0 percent) participated in this activity with a spouse or partner. Almost two-thirds of
the women business owners (60.8 percent) said they were confident or very confident
about their ability to undertake the tasks related to the successful management of their
firms.
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Correlational analyses were conducted to determine the relationship between the

level of firm sales, respondents’ perceived financial management skills, overall financial
management skills confidence, confidence in their ability to undertake the financial
tasks related to their business, their age and education. As shown in Table II, findings
indicate that age was positively related to respondents’ perception of their financial
management skills (r ¼ 0.330; p , 0.05) and confidence in their financial management
skills (r ¼ 0.320; p , 0.05) such that older women entrepreneurs were more likely to rate
their skills as excellent and more confident in these skills. Age was also significantly
related to the amount of years of business experience respondents had prior to owning

Confidence
Level of Years of Confidence successful
firms’ experience Financial in financial financial
annual prior to owning management management management
sales business skills skills of business Age

Level of firms’
annual sales 1.0
Years of
experience
prior to owning
business 0.090 1.0
Financial
management
skills 0.085 0.325 * 1.0
Confidence
in financial
management
skills 0.184 0.193 0.750 * * 1.0
Confidence
successful
financial
management
of business 2 0.067 20.057 0.509 * * 0.516 * *
Age 2 0.185 0.380 * * 0.330 * 0.320 * 0.196 1.0
Education 0.089 20.076 2 0.179 20.168 2 0.235 2 0.259
Table II.
Correlations Notes: *p , 0.05; * *p , 0.01
 their business (r ¼ 0.380; p , 0.01). Additionally, all three of the variables asking Financial
respondents to comment on their financial management skills were highly correlated
with each other.
self-efficacy

Factor analysis
An exploratory factor analysis was conducted on the variables assessing respondents
perception of the financial management skills (i.e. how would you rate your financial 33
skills; how confident do you feel about your skills in financial management; how confident
do you feel regarding your ability to undertake the tasks related to the successful financial
management of your company) to determine if the observed correlations could be
explained by a smaller number of factors. A principal components extraction was used
with a varimax rotation. A one factor solution accounting for 73 percent of the variance
was obtained. Table III lists the factor analysis results.
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Reliability
Reliability analysis conducted on the three variables indicated a Cronbach’s alpha of
0.81. Given this strong measure of internal consistency, we created a financial
self-efficacy (FSE) scale where high numbers indicate that the respondents express
confidence in their financial management skills.

Comparison of means
One-way analysis of variance (ANOVA) was performed to test whether there is a
meaningful difference between respondent’s race and their FSE. Results indicated a
significant difference between respondents on the financial management skills variable.
White women entrepreneurs were more likely to rate their financial management skills
higher than respondents of color (F (1, 49) ¼ 1.744, p , 0.10). Additionally, there was a
significant difference between FSE and age. Older respondents were more likely to rate
their FSE higher than younger respondents (F (2, 48) ¼ 3.747, p , 0.05). Table IV lists
the ANOVA results.

Survey questions FSE

How would you rate your skills in financial management? 0.892

How confident do you feel about your skills in financial management? 0.896
How confident do you feel about your abilities to undertake the successful financial Table III.
management of your company? 0.770 Exploratory factor
Eigenvalue 2.191 analysis

Sum of squares df Mean square F Significance

Race
Between groups 1.637 5 1.637 1.744 0.104
Within groups 39.243 49 0.597
Age
Between groups 4.170 2 2.085 3.747 0.031 * *
Within groups 26.710 48 0.556
Table IV.
Note: Significance at: *0.10 and * *0.05 levels (two-tailed) ANOVA results
 IJGE V. Discussion
3,1 The results in the previous section present several noteworthy findings. First, we
developed a robust measure of a FSE construct which is more task specific than
broadly aggregated constructs of general self-efficacy and ESE. Additionally, results
suggest that age and racial differences are significantly related to FSE with Caucasians
and older respondents reporting higher levels. The differences related to race are
34 consistent with earlier research on self-efficacy and entrepreneurial intentions among
teenage girls (Marlino and Wilson, 2003; Wilson et al., 2009, 2004).
Taken together, the empirical findings discussed above only partially attest to a lack
of confidence combined with anxiety about dealing with financial management on the
part of women entrepreneurs. However, this sample represents a limited group of women
entrepreneurs participating in an entrepreneurial training program or already owning a
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business. Participation in such support programs may partially alleviate women’s

anxiety regarding the quantitative aspects of management. It should also be noted that
the majority of these firms had no employees aside from the entrepreneur herself. Thus,
it is very likely that these entrepreneurs faced fewer financial challenges and complexity
than would have been the case with larger firms. In the realm of entrepreneurship,
anxiety about the quantitative aspects of management and finance may cause women to
start small and relatively simple types of businesses, having limited opportunities for
profitability and growth. Discomfort or lack of experience with financial matters may
lead them to avoid seeking external sources of financing such as banks, angel investors,
or venture capitalists that would fuel new venture growth. If this is the case, women are
truly at a disadvantage.
As noted above, very little research has been conducted on women entrepreneurs
and FSE, and our preliminary findings suggest more research needs to be done. Further
study of nascent entrepreneurs and actual entrepreneurs would shed light on women’s
attitudes toward finance, as well as interventions that might help them to be better
prepared and increase self-confidence. Dhaliwal (2010) examined whether women
entrepreneurs really get the help they need and if the “one size fits all” strategy commonly
employed by most business support providers is effective. Some of the obvious
interventions might include mentoring relationships, networks and organizations, and
training and advisory programs that would help women entrepreneurs develop their
financial skills. Even earlier, younger female students should be encouraged to enroll in
quantitative classes and advised not to be discouraged if the material is difficult. Female
teachers and faculty in quantitative disciplines could serve as role models, as could female
guest speakers who are either successful entrepreneurs or who play some type of financial
role in an entrepreneurial organization. There is also a desperate need for more case
studies focusing on women in financial roles in either corporations or entrepreneurial
organizations.
In summary, although women are choosing entrepreneurship for a career path,
they are not taking advantage of the full range of economic and personal opportunities
that it could provide for them until they are willing to launch larger, more
complex ventures in high-growth industries. Prior research seems to suggest that a
lack of confidence in their abilities in quantitative and financial areas may serve as
an impediment to doing so. More research is needed to determine if this is the case,
and if it is, appropriate interventions targeted toward girls and young women are
warranted.
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self-efficacy
Personality and Social Psychology Bulletin, Vol. 28, pp. 1183-93.
Verheul, I., Uhlaner, L. and Thurik, R. (2005), “Business accomplishments, gender and
entrepreneurial self-image”, Journal of Business Venturing, Vol. 20, pp. 483-518.
37
About the authors
Frances M. Amatucci, PhD (University of Pittsburgh), is an Associate Professor in the School of
Business at Slippery Rock University where she teaches undergraduate courses in strategic
management and entrepreneurship. She is an Adjunct Professor at the H. Wayne Huizenga School
of Business and Entrepreneurship at Nova Southeastern University where she teaches graduate
courses related to global strategy and entrepreneurship. Her current research interests are women
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and minority entrepreneurship, sustainability, entrepreneurship finance and innovation.

Dr Frances M. Amatucci served on the Board of Directors of the United States Association for
Small Business and Entrepreneurship for several years as past Chair of the Women and Minority
Track and Senior Vice President of Operational and Planning. She is a Managing Director of the
Sustainable Enterprise Accelerator at Slippery Rock University. Frances M. Amatucci is the
corresponding author and can be contacted at: frances.amatucci@sru.edu
Daria C. Crawley, PhD (University of Michigan), is Associate Professor of Management at
Robert Morris University where she teaches organizational behavior and international business
at the undergraduate and graduate levels and Chairs the School of Business Ethics Committee.
Dr Daria C. Crawley has taught internationally in Slovakia and Germany, studied public policy
legislation in the European Union while working for a Member of British Parliament and worked
as a management consultant in Jamaica. Her current research examines the career experiences of
ethnic minority expatriates, women entrepreneurs, the impact of technology on student learning
and issues centering on diversity and pedagogy.

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