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Urbanization and agglomeration benefits : gender differentiated impacts on enterprise creation in India's informal sector

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  • Ghani, Ejaz
  • Kanbur, Ravi
  • O'Connell, Stephen D.

Abstract

This paper presents an exploration at the intersection of four important themes in the current development discourse: urbanization, agglomeration benefits, gender and informality. Focusing on the important policy objective of new enterprise creation in the informal sector, it asks and answers four specific questions on the impact of urbanization and gender. It finds that (i) the effect of market access to inputs, on creation of new enterprises in the informal sector, is greater in more urbanized areas; (ii) This"urbanization gradient"also exists separately for the creation of female owned enterprises and male owned enterprises; (iii) there is a differential impact of female specific market access compared to male specific market access, on female owned enterprise creation in the informal sector ; and (iv) gender specific market access to inputs matters equally in more or less urbanized areas. Among the policy implications of these findings are that (i) new enterprise creation by females can be encouraged by urbanization, but (ii) the effect can be stronger by improving female specific market access, especially to inputs. The analysis in this paper opens up a rich research agenda, including further investigation of the nature of input based versus output based perspectives on agglomeration benefits, and exploration of policy instruments that can improve female specific market access, which is shown to increase female owned enterprise creation.

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Bibliographic Info

Paper provided by The World Bank in its series Policy Research Working Paper Series with number 6553.

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Date of creation: 01 Aug 2013
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Handle: RePEc:wbk:wbrwps:6553

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Keywords: Markets and Market Access; Housing&Human Habitats; Microfinance; Gender and Health; Debt Markets;

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  1. Overman, Henry G. & Venables, Anthnony J., 2010. "Evolving City Systems," Working Paper Series UNU-WIDER Working Paper W, World Institute for Development Economic Research (UNU-WIDER).
  2. Ejaz Ghani & William R. Kerr & Stephen D. O'Connell, 2013. "Local industrial structures and female entrepreneurship in India," Journal of Economic Geography, Oxford University Press, vol. 13(6), pages 929-964, November.
  3. Edward L. Glaeser & William R. Kerr, 2008. "Local Industrial Conditions and Entrepreneurship: How Much of the Spatial Distribution Can We Explain?," NBER Working Papers 14407, National Bureau of Economic Research, Inc.
  4. Zephyr, 2010. "The city," City, Taylor & Francis Journals, vol. 14(1-2), pages 154-155, February.
  5. Megha Mukim, 2011. "Industry and the urge to cluster: a study of the informal sector in India," LSE Research Online Documents on Economics 33592, London School of Economics and Political Science, LSE Library.
  6. Jofre-Monseny, Jordi & Marín-López, Raquel & Viladecans-Marsal, Elisabet, 2011. "The mechanisms of agglomeration: Evidence from the effect of inter-industry relations on the location of new firms," Journal of Urban Economics, Elsevier, vol. 70(2), pages 61-74.
  7. Ghani, Ejaz & Kanbur, Ravi, 2013. "Urbanization and (in)formalization," Policy Research Working Paper Series 6374, The World Bank.
  8. Ejaz Ghani & William R. Kerr & Stephen D. O'Connell, 2011. "Spatial Determinants of Entrepreneurship in India," NBER Working Papers 17514, National Bureau of Economic Research, Inc.
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Cited by:
  1. Ghani, Ejaz & Mani, Anandi & O'Connell, Stephen D., 2013. "Can political empowerment help economic empowerment ? women leaders and female labor force participation in India," Policy Research Working Paper Series 6675, The World Bank.
  2. Ghani, Ejaz & Kerr, William R. & O'Connell, Stephen D., 2013. "Political reservations and women's entrepreneurship in India," Policy Research Working Paper Series 6307, The World Bank.

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