Female Innovative Entrepreneurship and Maternity Risk
76 Pages Posted: 10 Mar 2020 Last revised: 23 Nov 2021
Date Written: January 13, 2020
I investigate how female innovative entrepreneurship responds to shocks to maternity risk, defined as the possibility of unexpected pregnancies. Exploiting the liberalization of an emergency contraception pill in Italy, combined with cross-sectional variation in access to abortion, I find that lower maternity risk leads to an increase in equity holdings, initial investments, and probability of being executive of younger female founders. Firms with more female-held equity also become riskier but more likely to attract venture capital in their early stages. Therefore, decreasing maternity risk reduces the gender gap in entrepreneurship, and it allows women to select into riskier ventures.
Keywords: entrepreneurship; contraception; gender gap; maternity risk; equity holdings
JEL Classification: G30, L26, M13, J16
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