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Gender discrimination, social networks and access to informal finance of Vietnamese small and medium enterprises

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  • Bach, Thang Ngoc
  • Le, Thanh
  • Nguyen, Thang Xuan
  • Hoang, Khanh

Abstract

The issue of gender discrimination in the informal credit market is under-investigated given that existing studies largely consider formal bank loans. Using a rich dataset on access to informal loans and loan terms of Vietnamese privately-owned manufacturing small and medium enterprises over 2005-2015, this paper finds that female-run firms have a lower propensity to borrow and incur a higher cost of borrowing from informal sources than male-run counterparts. The empirical evidence on gender discrimination is robust to the control of different firm characteristics, firm-specific unobserved heterogeneity, and selection bias. With the potential to mitigate gender discrimination, extended social networks are found to work in favor of female-run firms.

Suggested Citation

  • Bach, Thang Ngoc & Le, Thanh & Nguyen, Thang Xuan & Hoang, Khanh, 2023. "Gender discrimination, social networks and access to informal finance of Vietnamese small and medium enterprises," Economic Analysis and Policy, Elsevier, vol. 78(C), pages 358-372.
    • Handle: RePEc:eee:ecanpo:v:78:y:2023:i:c:p:358-372
    DOI: 10.1016/j.eap.2023.03.017
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    References listed on IDEAS

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    More about this item

    Keywords

    Gender discrimination; Social networks; Financial accessibility; Cost of funding; SMEs;
    All these keywords.

    JEL classification:

    • A13 - General Economics and Teaching - - General Economics - - - Relation of Economics to Social Values
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination

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