Even in Entrepreneurship, Women Face Gender Constraints

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A woman waits to cross a road in the Kasumigaseki area of Tokyo, Japan.

Photographer: Tomohiro Ohsumi/Bloomberg

For women who face disadvantages in climbing the corporate ladder, entrepreneurship is a potential way for them to meet their potential. But even then, women still face gender-related constraints when starting a business, according to a study by the Asia-Pacific Economic Cooperation.

Laws that restrict women's access to financing is one key barrier for female owners of small and medium enterprises, according to the study.

“Restrictive inheritance laws are a good example of this type of barrier. The practical effect is that these laws prevent women from using land as collateral when applying for loans,” said Carlos Kuriyama, senior analyst at APEC’s policy support unit and a co-author of the study. “In some economies, women are unable to apply for credit without authorization from their husbands.”

“Because of this, women small business owners tend to turn to non-bank institutions, such as microfinance organizations, to gain capital,” said Kuriyama. “With this insight into the financing challenges, APEC can highlight the laws that restrict equal access to capital and hopefully encourage reform.”

Another issue facing female entrepreneurs are cultural and social norms which result in women having less time to devote to business because of the need to engage in household tasks, like childcare. Having access to affordable formal childcare would enable mothers to spend more time on paid work, including their own businesses, according to the study.

Governments must get involved to address gender inequality, starting with providing affordable childcare and early education services, according to Huani Zhu, researcher at APEC’s policy support unit and the study’s co-author. “It has become clear that in economies where social norms prescribe less active economic roles for women, the relevant government bodies involved in gender equality play an important role,” said Zhu.

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