Closing the Gender Gap – Personal Initiative Training and Female Business Performance

Abstract

While female entrepreneurship has important impacts on economic development, female-owned businesses obtain lower profits and lower growth rates than male- owned businesses. We conduct a randomized controlled field experiment with 1196 entrepreneurs in Lomé, Togo, to determine whether personal initiative training constitutes a way to enhance female entrepreneurs’ business success and to close this gender gap. Basing our argumentation on social role theory and the process model of entrepreneurial action, we argue that because of their social gender roles female entrepreneurs perceive that entrepreneurial action incurs higher risks and lower returns. We hypothesize that personal initiative training leads female entrepreneurs to decrease perceived risks of entrepreneurial action by increasing their entrepreneurial self-efficacy and error competence and to increase their perceived returns of entrepreneurial action by increasing entrepreneurial passion, which ultimately leads to female entrepreneurs’ business success. The results largely support our hypotheses. This study contributes to the literature on the gender gap in entrepreneurship and has important implications for entrepreneurial training interventions.

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