IDEAS home Printed from https://ideas.repec.org/a/plo/pone00/0279418.html
   My bibliography  Save this article

Business grants following natural disasters and their different impact on the performance of female and male-owned microenterprises: Evidence from Sri Lanka

Author

Listed:
  • Ha Luong

Abstract

Objective: This paper investigates gender differences in the treatment effects of business grants on firm performance following natural disasters, and seeks to identify the mechanisms underlying the unequal effects. Method: A panel data-set from an experiment in Sri Lanka is used to measure the difference in the treatment effects of a business grant on the performance of female and male-owned firms following the 2004 Indian Ocean tsunami. The sample of 608 microenterprises includes 297 female-owned firms and 311 male-owned firms. There are 338 firms (Male = 176, Female = 162) in the treatment group that received the grant and 270 firms (Male = 135, Female = 135) in the control group that did not receive the grant. Data on firm performance, firm characteristics and owner characteristics were collected in 13 survey waves from April 2005 to December 2010. Firm performance, which is measured by firm profit, is assessed by employing linear regression with fixed effects in an intention-to-treat analysis. Findings: The results suggest that the business grant has a positive impact on the performance of male-owned firms, but zero effect on that of female-owned firms. Several potential mechanisms drive the results, including gender differences in business investment, household expenditure and initial business closures. The results also show a positive treatment effect of the business grant on the psychological recovery of recipients, but there is no evidence supporting gender differences in this dimension. Contribution: This paper provides new evidence on gender differences in the treatment effects of business grants on firm performance in the context of post-disasters, and has implications for business recovery programs aimed at supporting female microentrepreneurs in the aftermath of large-scale catastrophes.

Suggested Citation

  • Ha Luong, 2022. "Business grants following natural disasters and their different impact on the performance of female and male-owned microenterprises: Evidence from Sri Lanka," PLOS ONE, Public Library of Science, vol. 17(12), pages 1-28, December.
    • Handle: RePEc:plo:pone00:0279418
    DOI: 10.1371/journal.pone.0279418
    as

    Download full text from publisher

    File URL: https://journals.plos.org/plosone/article?id=10.1371/journal.pone.0279418
    Download Restriction: no
    File URL: https://journals.plos.org/plosone/article/file?id=10.1371/journal.pone.0279418&type=printable
    Download Restriction: no
    File URL: https://libkey.io/10.1371/journal.pone.0279418?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Vasco M Carvalho & Makoto Nirei & Yukiko U Saito & Alireza Tahbaz-Salehi, 2021. "Supply Chain Disruptions: Evidence from the Great East Japan Earthquake," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 136(2), pages 1255-1321.
    2. David Strömberg, 2007. "Natural Disasters, Economic Development, and Humanitarian Aid," Journal of Economic Perspectives, American Economic Association, vol. 21(3), pages 199-222, Summer.
    3. Stjepan Srhoj & Bruno Škrinjarić & Sonja Radas, 2021. "Bidding against the odds? The impact evaluation of grants for young micro and small firms during the recession," Small Business Economics, Springer, vol. 56(1), pages 83-103, January.
    4. Suresh de Mel & David McKenzie & Christopher Woodruff, 2009. "Returns to Capital in Microenterprises: Evidence from a Field Experiment," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 124(1), pages 423-423.
    5. Angeles, Gustavo & de Hoop, Jacobus & Handa, Sudhanshu & Kilburn, Kelly & Milazzo, Annamaria & Peterman, Amber, 2019. "Government of Malawi's unconditional cash transfer improves youth mental health," Social Science & Medicine, Elsevier, vol. 225(C), pages 108-119.
    6. Suresh De Mel & David McKenzie & Christopher Woodruff, 2012. "Enterprise Recovery Following Natural Disasters," Economic Journal, Royal Economic Society, vol. 122(559), pages 64-91, March.
    7. Suresh de Mel & David McKenzie & Christopher Woodruff, 2009. "Are Women More Credit Constrained? Experimental Evidence on Gender and Microenterprise Returns," American Economic Journal: Applied Economics, American Economic Association, vol. 1(3), pages 1-32, July.
    8. Hanna Berkel & Peter Fisker & Finn Tarp, 2021. "Cash grants to manufacturers after Cyclone Idai: RCT evidence from Mozambique," WIDER Working Paper Series wp-2021-87, World Institute for Development Economic Research (UNU-WIDER).
    9. Wincent, Joakim & Örtqvist, Daniel & Drnovsek, Mateja, 2008. "The entrepreneur's role stressors and proclivity for a venture withdrawal," Scandinavian Journal of Management, Elsevier, vol. 24(3), pages 232-246, September.
    10. Domingo, Sonny N. & Ballesteros, Marife M., 2015. "Building Philippine SMEs Resilience to Natural Disasters," Discussion Papers DP 2015-20, Philippine Institute for Development Studies.
    11. Gerrit Mueller & Erik Plug, 2006. "Estimating the Effect of Personality on Male and Female Earnings," ILR Review, Cornell University, ILR School, vol. 60(1), pages 3-22, October.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Nicola Limodio, 2015. "The Development Impact of Financial Regulation: Evidence from Ethiopia and Antebellum USA," 2015 Meeting Papers 355, Society for Economic Dynamics.
    2. Grover,Arti Goswami & Kahn,Matthew Edwin, 2024. "Firm Adaptation to Climate Risk in the Developing World," Policy Research Working Paper Series 10797, The World Bank.
    3. Bommer, Christian & Dreher, Axel & Perez-Alvarez, Marcello, 2022. "Home bias in humanitarian aid: The role of regional favoritism in the allocation of international disaster relief," Journal of Public Economics, Elsevier, vol. 208(C).
    4. Simone Schaner, 2018. "The Persistent Power of Behavioral Change: Long-Run Impacts of Temporary Savings Subsidies for the Poor," American Economic Journal: Applied Economics, American Economic Association, vol. 10(3), pages 67-100, July.
    5. Amna Javed & Najaf Zahra & Ana Maria Munoz Boudet, 2023. "What do We Know About Interventions to Increase Women’s Economic Participation and Empowerment in South Asia?," World Bank Publications - Reports 39646, The World Bank Group.
    6. Gabriela Calderon & Jesse M. Cunha & Giacomo De Giorgi, 2020. "Business Literacy and Development: Evidence from a Randomized Controlled Trial in Rural Mexico," Economic Development and Cultural Change, University of Chicago Press, vol. 68(2), pages 507-540.
    7. Akuffo Amankwah & Hibret Belete Maemir & Pauline Castaing & Amparo Palacios-Lopez & Attah-Ankomah,Richmond & Diego Zardetto & David C. Francis, 2025. "Using Household Surveys and Specialized Enterprise Surveys to Measure Informal Enterprises," Policy Research Working Paper Series 11119, The World Bank.
    8. Gazeaud, Jules & Khan, Nausheen & Mvukiyehe, Eric & Sterck, Olivier, 2023. "With or without him? Experimental evidence on cash grants and gender-sensitive trainings in Tunisia," Journal of Development Economics, Elsevier, vol. 165(C).
    9. Catia Batista & Sandra Sequeira & Pedro C. Vicente, 2022. "Closing the Gender Profit Gap?," Management Science, INFORMS, vol. 68(12), pages 8553-8567, December.
    10. Oriana Bandiera & Robin Burgess & Narayan Das & Selim Gulesci & Imran Rasul & Munshi Sulaiman, 2017. "Labor Markets and Poverty in Village Economies," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 132(2), pages 811-870.
    11. Emma Riley, 2024. "Resisting Social Pressure in the Household Using Mobile Money: Experimental Evidence on Microenterprise Investment in Uganda," American Economic Review, American Economic Association, vol. 114(5), pages 1415-1447, May.
    12. Yutaro Izumi & Hiroyuki Nakata & Yasuyuki Sawada & Kunio Sekiguchi, 2024. "Building Business Resilience to Disasters," CIRJE F-Series CIRJE-F-1223, CIRJE, Faculty of Economics, University of Tokyo.
    13. Lars Ivar Oppedal Berge & Kjetil Bjorvatn & Bertil Tungodden, 2015. "Human and Financial Capital for Microenterprise Development: Evidence from a Field and Lab Experiment," Management Science, INFORMS, vol. 61(4), pages 707-722, April.
    14. F. Zhou & W.J.W. Botzen, 2017. "The Impact of Natural Disasters on Firm Growth in Vietnam:: Interaction with Financial Constraints," Working Papers 17-20, Utrecht School of Economics.
    15. Elisa Navarra, 2022. "Stock Market Response to Firms’ Misconduct," Working Papers ECARES 2022-40, ULB -- Universite Libre de Bruxelles.
    16. Ranasinghe, Ashantha, 2024. "Misallocation across establishment gender," Journal of Comparative Economics, Elsevier, vol. 52(1), pages 183-206.
    17. Yaya KOLOMA & Zaka RATSIMALAHELO, 2015. "Jeunes, Acces Au Microcredit Et Performance Des Microentreprises : Une Evidence Au Mali," Working Papers 2015-15, CRESE.
    18. Kaoru Hosono & Daisuke Miyakawa & Taisuke Uchino & Makoto Hazama & Arito Ono & Hirofumi Uchida & Iichiro Uesugi, 2016. "Natural Disasters, Damage To Banks, And Firm Investment," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 57(4), pages 1335-1370, November.
    19. Uesugi, Iichiro & Miyakawa, Daisuke & Hosono, Kaoru & Ono, Arito & Uchida, Hirofumi, 2025. "The collateral channel versus the bank lending channel: Evidence from a massive earthquake," Journal of Banking & Finance, Elsevier, vol. 170(C).
    20. Joshua D Merfeld, 2020. "Moving Up or Just Surviving? Nonfarm Self‐Employment in India," American Journal of Agricultural Economics, John Wiley & Sons, vol. 102(1), pages 32-53, January.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:plo:pone00:0279418. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: plosone (email available below). General contact details of provider: https://journals.plos.org/plosone/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.