Take Care of Home and Family, Honey, and Let Me Take Care of the Money - Gender Bias and Credit Market Barriers for Female Entrepreneurs

45 Pages Posted: 8 Mar 2013

See all articles by Steven Ongena

Steven Ongena

University of Zurich - Department Finance; Swiss Finance Institute; KU Leuven; NTNU Business School; Centre for Economic Policy Research (CEPR)

Alexander A. Popov

European Central Bank (ECB)

Date Written: March 6, 2013

Abstract

We identify the causal effect of gender bias on access to finance. We extract an exogenous measure of gender bias from survey responses by descendants of US immigrants on questions about the role of women in society. We then investigate a detailed dataset on small business firms from 17 countries and find that the inherited component of gender bias is associated with gender-based discrimination in the credit market of the immigrants' country of origin. In particular, in countries with higher gender bias, female-owned firms are more frequently discouraged from applying for bank credit and are more reliant on informal finance.

Keywords: Cultural bias, Gender-based discrimination, Female-owned firms, Credit supply

JEL Classification: G21, J16, N32, Z13

Suggested Citation

Ongena, Steven R. G. and Popov, Alexander A., Take Care of Home and Family, Honey, and Let Me Take Care of the Money - Gender Bias and Credit Market Barriers for Female Entrepreneurs (March 6, 2013). European Banking Center Discussion Paper No. 2013-001, Available at SSRN: https://ssrn.com/abstract=2229194 or http://dx.doi.org/10.2139/ssrn.2229194

Steven R. G. Ongena (Contact Author)

University of Zurich - Department Finance ( email )

Schönberggasse 1
Zürich, 8001
Switzerland

Swiss Finance Institute

c/o University of Geneva
40, Bd du Pont-d'Arve
CH-1211 Geneva 4
Switzerland

KU Leuven ( email )

Oude Markt 13
Leuven, Vlaams-Brabant 3000
Belgium

NTNU Business School ( email )

Norway

Centre for Economic Policy Research (CEPR)

London
United Kingdom

Alexander A. Popov

European Central Bank (ECB) ( email )

Sonnemannstrasse 22
Frankfurt am Main, 60314
Germany

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