Bank loan officers' perceptions of the characteristics of men,women, and successful entrepreneurs

Much anecdotal evidence suggests that women, compared to similarly situated men, have great difficulty securing financing for entrepreneurial endeavors. In addition, a mounting body of evidence illustrates how women in managerial roles are perceived in terms of sex stereotypes rather than in terms of their accomplishments. The present study extends this line of research to investigate whether female entrepreneurs are also viewed in terms of sex stereotypes.One hundred and six bank loan officers evaluated either men, women, or successful entrepreneurs on scales assessing nine attributes of successful entrepreneurs.² The nine entrepreneurial qualities were leadership, autonomy, propensity to take risks, readiness for change, endurance, lack of emotionalism, low need for support, low conformity and persuasiveness. It was hypothesized that sex stereotypes influenced perceptions that women, compared to men, did not possess the characteristics necessary for successful entrepreneurship.Results confirmed the hypothesis that characteristics attributed to successful entrepreneurs were more commonly ascribed to men than to women. On the dimensions of leadership, autonomy, risk taking, readiness for change, endurance, lack of emotionalism and low need for support, bank loan officers rated women as significantly less like successful entrepreneurs compared to men. While gender differences on the remaining three dimensions failed to reach statistical significance, women were never rated as closer to successful entrepreneurs than were men. These results are consistent with anecdotal evidence of the difficulties female entrepreneurs encounter in securing working capital. The results are also consistent with past research examining commonly held sex stereotypes of male and female managers and executives.These findings raise questions regarding the degree to which loan officers are influenced by sex stereotypes in considering loan applications from male and female aspiring entrepreneurs. From a bank's perspective, it may be important to train loan officers to avoid falling back on sex stereotypes in evaluating proposals for new businesses. Similarly, it may be important to alert female entrepreneurs to the need to dispel traditional sex stereotypes in the context of loan application interviews.     

Women’s Roles on U.S. Fortune 500 Boards: Director Expertise and Committee Memberships

This study examines the presence and roles of female directors of U.S. Fortune 500 firms, focusing on committee assignments and director background. Prior work from almost two decades ago concludes that there is a systematic bias against females in assignment to top board committees. Examining a recent data set with a logistic regression model that controls for director and firm characteristics, director resource-dependence roles and interaction between director gender and director characteristics, we find that female directors are less likely than male directors to sit on executive committees and more likely than male directors to sit on public affairs committees. There is little if any evidence of systematic gender bias in director assignment to other board committees. We find some evidence that boards evaluate resource dependence differently for women than men. Craig A. Peterson Western Michigan University, Grand Rapios, MI 49503, USA Craig A. Peterson is associate professor of finance at Western Michigan University, Grand Rapids Regional Center. In addition to corporate governance, his research interests include investment management and corporate finance. James Philpot is assistant professor of finance and general business at Missouri State University. His research interests include corporate governance, financial planning and financial education.     

Subjectivity in credit allocation to micro-entrepreneurs: evidence from Brazil

This paper estimates the impact of loan officer subjectivity on microcredit granting by exploiting an exceptionally detailed database from a Brazilian microfinance institution. The loan officers collect field data, meet with applicants, and make recommendations to the credit committee, which has the final say on both loan approval and loan size (LS). The loan officer’s subjectivity is captured through gender bias. Our estimations indeed show subjective gender gap in LS. This gap is almost exclusively attributable to loan officers. We interpret this finding as evidence that, despite monitoring and wage incentivization, microcredit officers let their subjective preferences interfere with loan granting. We conclude by suggesting alternative means to curb subjectivity in credit allocation to micro-entrepreneurs.     

Code of Ethics: A Stratified Vehicle for Compliance

When a business owner approaches a bank for a loan for their business they might hope that a well-established bureaucratic procedure would ensure that their application was processed with stipulated rules and impersonal criteria. They might expect that two bank officials, evaluating the same proposal for a loan, would reach the same decision. However, research shows that both quantifiable data and “gut feelings” are used in the decision. In this research, analysis of interviews with senior managers, and both individual and focus group interviews with bank loan officers, reveals that there are no set criteria or stipulated rules. The interviews demonstrate how and why nonquantifiable data is used, and why different bank officials can reach different conclusions on the same loan proposal. While these bank loan officers do not appear to be discriminatory against female business owners, the lending criteria and process allows significant room for discrimination. It appears questionable whether bank lending is seen as an ethical and fair process.     

How do female entrepreneurs perform? Evidence from three developing regions

Using the World Bank Enterprise Survey data, we analyze performance gaps between male- and female-owned companies in three regions—Eastern Europe and Central Asia (ECA), Latin America (LA), and Sub-Saharan Africa (SSA). Among our findings are significant gender gaps between male- and female-owned companies in terms of firm size, but much smaller gaps in terms of firm efficiency and growth (except in LA). Part of the reason women run smaller firms is that they tend to concentrate in sectors in which firms are smaller and less efficient (in ECA and SSA). By contrast, we find no evidence of gender discrimination in access to formal finance in any of the three regions, although in ECA women are less likely than men to seek formal finance. Finally, while female entrepreneurs receive smaller loans than their male counterparts, the returns from each dollar they receive is no lower in terms of overall sales revenue.     

Identifying successful versus unsuccessful loans held by the minority small business clients of an OMBE affiliate

Successful and unsuccessful loans to minority small businessmen are discriminated using applicant demographic and firm characteristic variables available at the time of application for 65 firms in Cleveland, Ohio. The businessmen studied are the clients of an affiliate of the Office of Minority Business Enterprise and represent a unique segment of the small business community, which has proven to be particularly success resistant. A set of demographic and firm variables are identified that are associated with loan success and can be used to construct a profile of preferred loan applicants. The relative importance of the different variables in discriminating between the two groups of loans and their combined explanatory power is reported.     

A Gender Analysis of Bank Loan Negotiations in Uganda

This paper highlights the differences between men and women in bank loan negotiations. It presents findings of an ex post facto design study that involved administering questionnaires to 289 respondents who had ever applied for a loan from a Ugandan commercial bank from 1999 through 2005. Results showed that male and female respondents differed in their negotiation behavior and outcomes. Female respondents scored higher than male respondents on self-enhancement and yielding. Male respondents scored higher than female respondents on inaction. Results further showed that female respondents receive lower payoff than male respondents from bank loan negotiations, and that both male and female respondents encounter problems in mixed gender negotiations.     

A theoretical overview and extension of research on sex,gender, and entrepreneurship

With the rising number of women-owned businesses has come a considerable amount of research, and even more speculation, on differences between male and female entrepreneurs and their businesses. To date, these findings and speculations have been largely atheoretical, and little progress has been made in understanding whether such differences are pervasive, let alone why they might exist. Thus public policy-makers have had little guidance on such difficult issues as whether or not unique training and support programs should be designed for women versus men. Moreover, lenders who finance new and growing firms have little to go on but their own “gut instinct” in assessing whether women's and men's businesses are likely to run in similar ways, or whether they might be run in different but equally effective ways.The lack of integrative frameworks for understanding the nature and implications of issues related to sex, gender, and entrepreneurship has been a major obstacle. Two perspectives that help to organize and interpret past research, and highlight avenues for future research, are liberal feminism and social feminism.Liberal feminist theory suggests that women are disadvantaged relative to men due to overt discrimination and/or to systemic factors that deprive them of vital resources like business education and experience. Previous studies that have investigated whether or not women are discriminated against by lenders and consultants, and whether or not women actually do have less relevant education and experience, are consistent with a liberal feminist perspective. Those empirical studies that have been conducted provide modest evidence that overt discrimination, or any systematic lack of access to resources that women may experience, impedes their ability to succeed in business.Social feminist theory suggests that, due to differences in early and ongoing socialization, women and men do differ inherently. However, it also suggests that this does not mean women are inferior to men, as women and men may develop different but equally effective traits. Previous entrepreneurship studies that have compared men and women on socialized traits and values are consistent with a social feminist perspective. These studies have documented few consistent gender differences, and have suggested that those differences that do exist may have little impact on business performance.While this interpretation of past findings is relevant to the question of if and how female and male entrepreneurs differ, there are still large gaps in our knowledge. In particular, only one study (Kalleberg and Leicht 1991) has systematically explored whether or not potential differences related to discrimination or socialization affect business performance; the study used limited measures of business performance, and assessed only a restricted range of male I female differences. This article reports on a study that explored other potential differences related to discrimination and to socialization (which are hypothesized based on liberal and social feminism) and looked at their relationship to a more comprehensive set of business performance measures.The study indicates that for a large, randomly selected sample of entrepreneurs in the manufacturing, retail, and service sectors, there were few differences in the education obtained by males and females, or in their business motivations. Women entrepreneurs were, however, found to have less experience in managing employees, in working in similar firms, or in helping to start-up new businesses. Women's firms also were found to be smaller than men's, to have lower growth in income over two years, and to have lower sales per employee. Regressions undertaken to examine predictors of a range of business performance indicators suggest that women's lesser experience in working in similar firms and in helping to start-up businesses may help to explain the smaller size, slower income growth, and lesser sales per employee of their firms.For policy-makers, this article suggests that systemic factors that afford women less access to experience must be addressed. Support for classroom training or related advisory activities may not be warranted; there is little evidence that women lack access to relevant classroom education. However, programs that help increase women's access to hands-on experience in starting firms or in working in the industry in which they hope to set up business does seem advisable. In-class education or counseling would not seem to compensate for lack of real-world experience, which suggests that any available funds should be directed more toward initiatives centered on apprenticeship programs than toward those centered on classroom teaching.Implications for lenders and investors are less clear cut, but suggest that whatever innate differences may exist between men and women are irrelevant to entrepreneurship. While women's businesses do not perform as well as men's on measures of size, they show fewer differences on other, arguably more critical business effectiveness measures-growth and productivity—and no differences on returns. Discrimination against women-owned businesses based on these findings would clearly be both unethical and unwarranted. The fact that women appear to obtain similar growth, productivity, and returns, in fact, suggests that they may be compensating for experience deficits in ways that current research does not illuminate. While more systematic inquiry is required to assist in understanding why men's and women's firms may differ in some predictable ways, this study would suggest that lenders and investors wishing to assist small businesses should focus on evaluating the amount and quality of the business and non-business experience of entrepreneurs, and consider sex an irrelevant variable.For entrepreneurs, this research reinforces the notion that acquiring relevant industry and entrepreneurial experience is of considerable importance if they seek to establish large firms and/or to achieve substantial firm productivity and returns. In particular, helping in the start-up of firms and spending extended periods of time in the industry of choice appear to yield subsequent rewards in the performance of any individual's firm. Future research is needed to investigate whether or not other types of business experience or non-business experience might bring additional benefits in terms of positive impact on future business performance, but the indication of the current work is that one's sex per se is neither a liability nor an asset.     

The Influence of Funding Approaches,Growth Expectations,and Industry Gender Distribution on High‐Growth Women Entrepreneurs

This study examines three key aspects of entrepreneurship associated with women business owners and their ability to achieve high growth: debt versus equity financing, growth expectations, and industry gender distribution. We present a number of theoretical lenses spanning disciplines such as gender studies, entrepreneurship, social psychology, and finance. Using longitudinal data from U.S. startups over an eight‐year period, our research reveals a number of interesting findings. We find that, proportionally, high‐growth women entrepreneurs are more likely to finance their growth with personal and business equity funding. Additionally, women‐owned firms in “feminine industries” are more likely to achieve high growth than women‐owned firms in “non‐feminine industries.”     

Female Handgun Ownership,Usage, and Attitudes Toward Training:

Recent research has reflected an increased handgun ownership among females in the United States. This increase in female gun ownership and purchasing has occurred simultaneously with the alarming increase in violent crimes committed against women. The increased interest in, and purchase of, handguns by women provided a needed new market for gun manufacturers. The purpose of the study was to access female handgun ownership, purchase patterns, and attitudes toward gun usage and safety. The findings of the study indicated that one-fourth of the women surveyed owned a handgun, and were motivated to purchase a handgun for personal protection. Also, approximately one-third of the female handgun owners had participated in certified handgun training. Societal implications of the findings are also discussed in the paper. The implications include proposals for: availability of low cost training, gun safety education in public schools, and a more active role of law enforcement officers and handgun manufacturers in providing handgun training.     

Potential Lending Discrimination? Insights from Small Business Financing and New Venture Survival

Previous literature provides potential lending discrimination evidence of disadvantaged women and minority entrepreneurs' high rate of business loan application denial and their unequal access to external and commercial credits in comparison with white business owners. This paper aims to expand the literature and discussions on small business loan discrimination from a new research direction, besides those on loan applications/denials and on loan terms, focusing on the consequences of small business loans in terms of new venture survivability. The proposed new research direction is consistent with similar research approaches in mortgage lending literature examining loan default rates and potential discrimination. The Kauffman Firm Survey data are used with appropriate hazards model for the analysis. Extensive creditworthiness and business survival determinants are applied for controlling for their influences across racial and ethnic groups. The main empirical finding is that after controlling for a wide variety of borrower, establishment, and regional characteristics, business closure rates for minority entrepreneurs are not higher than those for white business owners. This finding does not support the prediction of the model for lender bias against minority entrepreneurs.     

Microcredit: an answer to the gender problem in funding?

Microfinance institutions (MFIs) target people excluded from the traditional banking system. By providing start-up capital to these under-financed individuals, they enable a greater number of women to start their own business, particularly in sectors where initial capital requirements are high. Our study follows a portfolio of 3,640 microcredit applicants in France over the 2000–2006 time period, identifying MFI client profiles and bringing to light gender differences in borrowers compared to a wider sample of entrepreneurs. This study shows that the male–female gap found amongst company creators is also maintained amongst the clienteles of MFIs. Empirical results also suggest that gender is a decisive factor regarding the amount of credit provided to borrowers when comparing with other factors in the borrower and firm profile. Thus to a certain extent, MFIs are found to reinforce gender inequalities in France.     

How does the global microfinance industry determine its targeting strategy across cultures with differing gender values?

In this paper we empirically investigate the role of culture in determining the gender-targeting strategy of microfinance institutions (MFIs). We use female/male grammatical distinctions in language as the manifestation of culturally-inherited gender values. Our findings indicate that grammatical gender distinctions have a significant effect on the targeting strategy of MFIs. Specifically, MFIs target women in cultures where they are most likely to experience financial discrimination. This suggests that MFIs adapt to disparate discriminatory cultures in a way that serves their core mission of outreaching financially-excluded women, particularly where such strategy is most needed.     

Start-Up Capital: "Does Gender Matter?"

Female and male entrepreneurs differ in the way they finance their businesses. This difference can be attributed to the type of business and the type of management and experience of the entrepreneur (indirect effect). Female start-ups may also experience specific barriers when trying to acquire start-up capital. These may be based upon discriminatory effects (direct effect). Whether gender has an impact on size and composition of start-up capital and in what way, is the subject of the present paper. The indirect effect is represented by the way women differ from men in terms of type of business and management and experience. The direct effect cannot be attributed to these differences and is called the gender effect. We use of a panel of 2000 Dutch starting entrepreneurs, of whom approximately 500 are female to test for these direct and indirect effects. The panel refers to the year 1994. We find that female entrepreneurs have a smaller amount of start-up capital, but that they do not differ significantly with respect to the type of capital. On average the proportion of equity and debt capital (bank loans) in the businesses of female entrepreneurs is the same as in those of their male counterparts.     

Women, Ethics, and MBAs

We argue that the declining female enrollment in graduate business schools is a manifestation of gender bias in business education. The extant conceptual foundation of business education is one which views business activity in terms of a game with fixed and wholly material objectives. This concept betrays an underlying value system that reflects a male orientation. Business education is not merely amoral, therefore, but is gender biased. We suggest that business educators adopt a broadened behavioral rubric. Virtue-ethics theory provides such a rubric.     

Conditional Effects of Touch on Purchase Behavior

Interpersonal touch has been shown to affect consumer behaviors such as compliance with a request, impulse buying, and tipping behavior. In this study, we examine if the impact of touch on purchase behavior is gender specific, and if it depends on how much the individual likes the product. Findings indicate male consumers are more likely to purchase a product at low to moderate levels of perceived tastiness when they are touched by a female server, whereas females are less likely to purchase. However, the touch encounter doesn’t matter for either gender when a consumer really likes the product.     

Does scoring a subpopulation make a difference

Scorecards used by consumer credit providers to assess the probability that an applicant will default are usually built for the population of potential applicants as a whole. This paper investigates whether it is permissible and worth-while to build a separate scorecard for each subpopulation of applicants. We review the legal requirements to find that it is permissible to use separate scorecards for many, but not all, personal characteristics. Second, using data supplied by a credit card organization separate scorecards were built for several subpopulations for each of twelve personal characteristics. The predicted performance of each was compared with that gained form estimating a scorecard for the full population using three methods for setting the cut-off scores in an `independent' way. These methods differ in the degree to which the cut-off scores are independent of information about other subpopulation, in the level of discrimination achieved between likely good payers and defaulters and in the degree to which each method is robust to new data. We conclude, first, that creating scorecards using subpopulations does not necessarily give better discrimination between likely good payers and defaulters. Second, none of the three methods examined to set the cut-off scores dominates the others using the three desirable properties described; trade-offs are required. Finally, subpopulation scorecards lead to the rejection of fewer applicants than scorecards built on full populations.     

On the survival prospects of men's and women's new business ventures

In this study, we examine the relationship between owner and business characteristics and business survival. Our findings are based upon analyses of the Census Bureau's 1982 and 1987 Characteristics of Business Owners (CBO) survey data on a sample of white male and female sole proprietors. Two aspects of this study distinguish it from any related studies to date. First, we separately examine issues affecting the survival prospects of female-owned businesses, whereas previous studies have focussed solely on businesses owned by men. Second, we use data on cohorts of businesses started or acquired in two different time periods, namely 1980–1982 and 1985–1987. Overall, the mean survival rates of male-owned businesses in these two cohorts are 4- to 6% higher, respectively, that those of businesses owned by women.We hypothesize that wage employment provides opportunities for men and women to acquire the financial and human capital necessary for success in business ownership. In fact, most male and female business owners had some prior spell of employment in the wage sector. But there are gender differences in the status of wage workers that, we further hypothesize, could differentially impact the survival prospects of men's and women's new business ventures. First, women's lower average wage earnings may imply more binding financial constraints on the initial scale of women's businesses relative to men's. Second, we find that female owners in both cohorts are less likely than their male counterparts to have had any prior managerial experience or to have 10 or more years of general, prior paid employment experience, which may imply that female entrepreneurs are more constrained in the amount and quality of human capital that they acquire during wage employment. Female entrepreneurs' access to debt and equity capital has not been overlooked by policy makers. What has been largely overlooked are possible gender differences in the amount and quality of human capital of new entrepreneurs. Women's fewer years of general work experience and lesser exposure to managerial occupations may indicate a role for remedial education or mentoring of would-be female entrepreneurs.Women in both cohorts tended to use less financial capital to start or acquire their businesses than men did, and for the 1982 cohort, business survival is found to be positively related to the amount of start-up capital, other factors held constant. The survival prospects of both male- and female-owned businesses are greater for owners with 10 or more years of prior work experience and/or 4 or more years of college. So at least in terms of education and quantity of work experience, female entrepreneurs are at something of a disadvantage relative to their male counterparts. We find that prior managerial experience has no systematic positive or negative effects on the survival prospects of either men's or women's new business ventures, however.Finally, our research indicates that issues concerning business formation and survival must be considered within the context of prevailing macroeconomic conditions. For example, we find that the survival rates of both male- and female-owned businesses started in the 1985–1987 time period were considerably higher than those of businesses started in 1980–1982. Moreover, we uncover systematic differences in owner and business characteristics between our 1982 and 1987 cohorts, as well as differences in how these characteristics influence business survival. Specifically, both male and female owners in our 1982 cohort were better educated, were more likely to have had prior, paid managerial experience, and had more years of prior, paid employment experience, in general. Researchers interested in assessing the survival prospects of businesses over a given time period must consider changes in both product and labor markets over that period. Strength of demand in product markets will have an obvious, direct effect on business viability. The tightening and loosening of labor markets imply changes in potential wage earnings (an opportunity cost of being self-employed) and in this way can affect business dissolution.     

Child–mother nutrition and health status in rural Kenya: the role of intra‐household resource allocation and education

There exists gender bias in resource ownership in many parts of Kenya with women being more disadvantaged. Resource ownership and control within the household has differential impacts on the health and overall well‐being of male and female members. This paper examines intra‐household resource ownership and how it affects nutrition and health status of household members. Data from a household survey containing detailed gender‐disaggregated information on resource ownership as well as food and anthropometry were collected from a rural Kenyan district and used in the analysis. Results showed that male members of the household had more access to education, income and land than the females. Mothers’ education, household income, frequency of illness and nutrient intake were the most important factors that contributed to the nutritional status of children. The education and household’s economic status were important determinants of child morbidity. Malnutrition and poor health of children and women is linked to the existing poverty in the study region, therefore emphasis needs to be put on eradication of discrimination against women in accessing education and accessing land, which will contribute to an increase in household incomes. Government policies need to focus on promotion of nutrition education through adult education programmes and incorporating it in the school curricula. Improvement of health‐care facilities in rural areas is also paramount to improving health and nutrition in these areas.     

女性特质与创业发展绩效分析

女性创业者个人特质与其创业发展绩效具有一定的相关性,通过对创业女性的抽样调查,得出女性创业者的自我效能感和情绪智力越高,就越有可能取得更高的创业发展绩效;学历对女性创业发展绩效有显著影响,与创业不成功者相比,女性创业成功者多具有自我效能高、情绪智力高、学历高的"三高"特质。