The (Un) intended consequences of institutions lowering barriers to entrepreneurship: The impact on female workers

Abstract

We propose that institutions that reduce barriers to entrepreneurship lead to intended consequences, increasing entry rate among individuals facing obstacles to entrepreneurship, such as women. But these regulations also have unintended consequences, decreasing the value appropriated by women who stay in paid employment, as these women lose support of their departing peers. Using an exogenous reduction in entry barriers in Portugal between 2005 and 2009, we find that women launch new ventures at higher rates than men, when entry barriers fall, but the same changes lead to a relative decline in women's wages in paid employment. These effects are amplified for women in managerial positions, who benefit if they leave but lose if they stay. Our study contributes to a nuanced understanding of rent-allocation in firms. Managerial Summary: We study the unintended consequences of lowering barriers to entry-an important institutional change to foster entrepreneurship, especially among those facing strongest entry barriers. We examine the effects of such regulations on women departing to entrepreneurship and those staying in incumbent firms, using the registry data from Portugal. The results show that lowering entry barriers leads to higher rates of entrepreneurial entry among women, as intended. But we also find that this deregulation reform results in a wider gender pay gap

Employee Non-compete Agreements, Gender, and Entrepreneurship

“…She finds that, although certain policies designed to address work/family conflict discourage entrepreneurship among women, the deleterious effect is exclusively among those with limited employment options. Castellaneta et al (2020) find that simplifying governmental rules governing incorporation boosts entrepreneurship among women even more than men.…”

“…This paper contributes to the nascent literature on formal institutions, gender, and entrepreneurship (Elam and Terjesen 2010, Thébaud 2015, Castellaneta et al 2020. Legislative efforts focus on implementing programs targeted at ameliorating frictions that may hold women back from pursuing entrepreneurial ventures.…”

Desarrollo y aplicación de un modelo de desempeño de negocios para microemprendedoras: El caso de Chile

“…Como hemos señalado, son los estudios realizados los que dan cuenta de la realidad de mujeres emprendedoras en países desarrollados (Lee y Xiao, 2021;Castellaneta, et al, 2020;Banco Mundial, 2018;Paik, et al, 2018;Jacobides, et al, 2018;Harshana, 2016;Terjesen, et al, 2015;Sharma, et al, 2012;BID, 2009;Acs, 2008;Shane, 2008;Ucbasaran, 2008;OIT, 2008OIT, , 2007Van Stel, et al, 2007;Du Riestz y Henrekson, 2000), sin embargo, son muy menores los estudios orientados al desempeño de empresas de propiedad de mujeres y, dentro de estos últimos, son escasos particularmente en países latinoamericanos (Dezsö, y Gaddis, 2012).…”

“…Las mujeres han asumido un rol significativo en la creación de empresas y en el desarrollo económico como resultado de un cambio global y radical tanto en lo geopolítico como en la política económica, acometido por un importante número de países a lo largo de todo el mundo (Lerner et al, 1997). El emprendimiento se ha postulado como una de las principales vías para que las mujeres logren mejorar su nivel económico hasta alcanzar la paridad económica con el hombre, superando una situación de discriminación que, se ha comprobado, es difícil de remontar (OIT, 2007(OIT, , 2008(OIT, , 2015BID, 2009;CEPAL, 2010;Du Riestz y Henrekson, 2000;Castellaneta, et al, 2020;Rocha y van Praag, 2020;Jamali, 2009;OECD, 2007;Foss, et al, 2019;Ascher, 2012;Radović-Marković, 2017;Ena, 2009;Cabrera y Mauricio, 2017;Stephan y Drews, 2015;Flores, et al, 2011;Terjesen y Amorós, 2010;Amorós y Mandakovic, 2017;Davidsson, et al, 2018;Jacobides, et al, 2018;Foro Económico Mundial, 2009;ILO, 2008;Terjesen, et al, 2015). Si bien son diversos los estudios y análisis realizados para comprender esta realidad, en diferentes países poco se conoce con respecto a la realidad de países de Latinoamérica y el Caribe (Temkin, 2009).…”

Running their own show: Malaysian women entrepreneurs’ kaleidoscope careers

“…Considerable research has been conducted to highlight women's career decisions to opt-out of corporate positions (Frkal and Criscione-Naylor, 2020;Mainiero and Sullivan, 2005), but little is said about those who leave to become entrepreneurs (Mainiero and Sullivan, 2006;Terjesen, 2005;Wheadon and Duval-Couetil, 2019). Many of the existing efforts that examine women entrepreneurs have been devoted to documenting differences between men and women entrepreneurscparticularly the obstacles faced by women business owners (Castellaneta et al, 2020;Jennings and Brush, 2013;Gupta et al, 2020). Most of these studies focus on earlystage entrepreneurship (Wannamakok and Chang, 2020), which excludes women who are running more-established businesses and does not address women's career patterns at different stages.…”