Women Entrepreneurship, Demand Side Heterogeneity and Financial Inclusion in Rural India

Abstract

Over the years, emerging countries have taken several policy measures to encourage women’s entrepreneurial activity. Gender-based participation in economic activities brings the equitable distribution of wealth and socio-economic well-being, which helps achieve several sustainable development goals. Despite several policy initiatives, women entrepreneurs undergo social and cultural constraints, particularly in accessing financial services for business engagements and enhancements. Using the 77th household-level All India Debt and Investment Survey 2019 data, the study investigates the impact of financial inclusion on women entrepreneur and their livelihood in rural India. The study also captured the heterogenous effect of gender difference and other socio-economic aspects by including interaction effect, to understand the heterogeneity effect in the model. The findings suggest that uses to financial instruments encouraged female household heads to engage in self-employment. The study also iterates the importance of credit from formal and informal sources towards promoting entrepreneurial activity.