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Female business ownership and informal sector persistence

  • Ghani, Ejaz
  • Kerr, William R.
  • O'Connell, Stephen D.

The informal sector in India has been exceptionally persistent over the past two decades. Is this a bad thing? Not necessarily. This paper shows that a substantial share of the persistence in India's unorganized manufacturing sector is due to the rapid increase in female-owned businesses. Had women's participation remained in the proportion to male-owned businesses that was evident in 1994, the unorganized manufacturing sector would have declined in share rather than increased. Most of these new female-owned businesses are opened in the household and at a small scale, about a third of the size of a typical male-owned business in the informal sector. Yet, it appears that these businesses offer economic opportunities not otherwise present and a transition for some women from unpaid domestic work.

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Paper provided by The World Bank in its series Policy Research Working Paper Series with number 6612.

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Date of creation: 01 Sep 2013
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Handle: RePEc:wbk:wbrwps:6612
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