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Another Perspective on Gender Specific Access to Credit in Africa

Author

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  • Henrik Hansen

    (Institute of Food and Resource Economics, University of Copenhagen)

  • John Rand

    (Institute of Food and Resource Economics, University of Copenhagen)

Abstract

Using firm level data from eight Sub-Saharan Africa countries we examine credit constraint differentials between male and female manufacturing entrepreneurs. Enterprises owned by female entrepreneurs are less likely to be credit constrained compared to their male counterparts. The magnitude of this credit constraint gap varies with constraint and ownership definitions but the direction of the gap does not. Using a generalized Blinder-Oaxaca decomposition, we investigate if the gap is due to differences in observable characteristics or to unexplained variations in the returns to these characteristics. We find the gap to be associated with the unexplained component. We argue that the finding is mainly due to female gender favoritism in loans to micro and small firms because (i) the gap is reversed for medium size enterprises and, (ii) we find no sign of superior female entrepreneurial performance in terms of capacity utilization, labor productivity or firm size growth.

Suggested Citation

  • Henrik Hansen & John Rand, 2011. "Another Perspective on Gender Specific Access to Credit in Africa," IFRO Working Paper 2011/14, University of Copenhagen, Department of Food and Resource Economics.
  • Handle: RePEc:foi:wpaper:2011_14
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    4. Arne Bigsten & Mans Söderbom, 2006. "What Have We Learned from a Decade of Manufacturing Enterprise Surveys in Africa?," The World Bank Research Observer, World Bank Group, vol. 21(2), pages 241-265.
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    6. Fafchamps, Marcel, 2000. "Ethnicity and credit in African manufacturing," Journal of Development Economics, Elsevier, vol. 61(1), pages 205-235, February.
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    Cited by:

    1. O’Toole Conor M., 2014. "Does Financial Liberalisation Improve Access to Investment Finance in Developing Countries?," Journal of Globalization and Development, De Gruyter, vol. 5(1), pages 1-34, June.
    2. Casey, Eddie & O'Toole, Conor, 2013. "Bank-lending constraints and alternative financing during the financial crisis: Evidence from European SMEs," Papers WP450, Economic and Social Research Institute (ESRI).
    3. O’Toole Conor M., 2014. "Does Financial Liberalisation Improve Access to Investment Finance in Developing Countries?," Journal of Globalization and Development, De Gruyter, vol. 5(1), pages 1-34, June.
    4. Terrence Kairiza & Philemon Kiprono & Vengesai Magadzire, 2017. "Gender differences in financial inclusion amongst entrepreneurs in Zimbabwe," Small Business Economics, Springer, vol. 48(1), pages 259-272, January.
    5. Casey, Eddie & O'Toole, Conor M., 2014. "Bank lending constraints, trade credit and alternative financing during the financial crisis: Evidence from European SMEs," Journal of Corporate Finance, Elsevier, vol. 27(C), pages 173-193.
    6. repec:unu:wpaper:wp2012-67 is not listed on IDEAS

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    More about this item

    Keywords

    Credit; Entrepreneurship; Gender; Private Sector; SMEs;
    All these keywords.

    JEL classification:

    • 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
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance

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