SDG 5 GENDER EQUALITY
SDG 8 DECENT WORK AND ECONOMIC GROWTH
Gender inequality and empowerment of all women and girls is not a stand-alone sustainable development goal but rather an integral of the other goals of decent work and economic growth, poverty elimination and sustainable cities and communities. Women entrepreneurs play an important role in their economies. Our study fills a gap in the literature on women entrepreneurship in some ways. It focuses specifically on the early steps of business ventures for men and women who have potential and intention to start up their own businesses in the very near future. We explore the influence of factors related to personal characteristics, family relevance and social connections on their entrepreneurial decisions. We used a rich set of individual-level data from the Global Entrepreneurship Monitor (GEM) 2013 for six Southeast Asian countries which are at different stages of their economic development. This has allowed us to compare and draw implications on the relevance of the stage on business intentions across groups of men and women. At the country level, in our analysis of 2011–2015 data also from GEM, we found a potential negative correlation between the Total Early-Stage Entrepreneurial Activity (TEA) rates and urbanization levels in six ASEAN countries. The analysis at the individual level confirmed that women in ASEAN economies generally have a 4% higher probability than men of realizing their intentions in establishing business start-ups, other factors being equal. This result varies from country to country. The largest effect was in Indonesia (8%), followed by Thailand and Malaysia (3.8%) but there was no such difference in Singapore, the Philippines or Vietnam. Moreover, business skills are more important than general education in determining business start-ups. A business-oriented social network, especially knowing successful entrepreneurs, perceptions of entrepreneurship and attitudes also play critical roles in raising the probability for both men and women to create their business ventures by 10–20%.
Economic dimension impact: Entrepreneurial Activity by Gender
The global report of GEM (2016) shows the gender gap in the TEA rate (ratio of women to men participating in entrepreneurship) has narrowed by 6% since 2012. The ratios were reported to be in a positive upward trend since 2012 in three regions of which factor- and efficiency-driven Asia is one. In only ten economies out of 83 economies covered by the GEM survey in 2015 are women more likely than men to be entrepreneurs. Four of those ten are in the ASEAN-6: Vietnam, Indonesia, Malaysia and the Philippines, while Thailand had similar TEA rates between the two groups. In contrast, women in innovation-driven Asian economies (including Singapore, Japan and South Korea) exhibited lower TEA rates than those of men (GEM 2016). This is a consistent regional study of ASEAN entrepreneurship by Xavier et al. (2015) who noted that compared to other geographical regions, the ASEAN-6 region is the best performer in terms of gender equity with respect to male and female participation as well as significantly better than the GEM average. Except for Singapore, women in other ASEAN economies are as likely or more likely to be involved in early-stage entrepreneurial activity as are men.
The study’s focus is the very early stage of entrepreneurship when people have specific intentions to start their businesses. GEM defines this as the potential entrepreneur period for those who see opportunities in their environments, have capabilities to start businesses and are undeterred by the fear of failure. Within this group, there are also intentional entrepreneurs who intend to start a new business but have not yet paid salary or wages for more than three months. GEM defines entrepreneurial intention as the percentage of the adult nonentrepreneur population who intend to start a business within the next three years. This stage is important in the entrepreneurial process as a strong association exists between entrepreneurial intention and actual entrepreneurial behaviour.
In general, women in the ASEAN-6 countries have lower intentions than men to start a business in the future. On average, the entrepreneurial intention rate for men in ASEAN-6 countries is 27.9% and for women 25.3%. Women in the Philippines, as would be expected, have the highest rate of entrepreneurial intention, almost double the regional average. In addition, their rate of entrepreneurial intention is 1% lower than of men in the Philippines. Women in Malaysia have the lowest entrepreneurial intentions (12%), followed by Singaporean women (15%). To understand the above gender difference in business intention, we explored the role of contributing factors such as how women and men perceive their capability to start a business, whether their motivation for business is due to a necessity or an opportunity and whether they have a fear of failure. The extracted from Xavier et al. (2015) in their comprehensive studies of the ASEAN region. The capability perceptions demonstrate people’s views of the environment around them, beliefs about capabilities are more reflective of self-perceptions. They indicate individuals’ confidence that they have the knowledge, skills and experience required to start a new business.
In the ASEAN-6 region, half of the men surveyed believed that they were capable of engaging in entrepreneurial activity, compared to 44% of women in the region. The highest rates were observed in factor-driven countries like Vietnam, the Philippines and Indonesia whereas Singapore had lower rates. Gender differences were more marked in Singapore (11.8%) and Thailand (15.4%) while more even rates were found in Vietnam and the Philippines. In all GEM surveys, entrepreneurs were asked about their motives for starting a business. The entrepreneurs with necessity motives opted for entrepreneurship mostly because they have no other options for work, while entrepreneurs with opportunity motives prefer to pursue an opportunity. In general, we can consider those with necessity motives as being pushed into entrepreneurship, rather than actively taking advantage of a business opportunity or having a job but seeking a better opportunity.
The rates of opportunity motivation versus necessity-motivation for the ASEAN-6 countries in 2014. Although the rate of perceived opportunities is, in general, higher for men than for women, the difference between the genders in the ASEAN-6 region for perceived opportunities is relatively low (around 3%). Again, when the rates for individual countries are considered, a more diverse picture emerges. The Philippines has the highest rate in the region for female opportunity perception in 2014 and is also the only country in the region where women report higher rates than men. Thai men report the highest rate for opportunity perception in the region, resulting in a significant gender differential of 9%. Singaporeans have rates of lower opportunity perception for both men and women, less than half the regional average. Lastly, we specifically looked at the share of potential business women who were afraid of failure across three years: 2013–2015. The rate of fear of failure for each country. First, there was a trend for women in Vietnam and Thailand to be more confident to engage in a venture as the rate of fear of failure reduced. The only country in which women feared failure more men was Indonesia, while the share in Malaysia, Singapore and the Philippines stayed constant during 2013–2015. These are also the country differences that we observed in Fig. 5.7 for both men and women. However, in all country cases, it is apparent that women were more afraid of business failure than the overall population, i.e.compared to men because the sample size is very gender-balanced.
Entrepreneurship plays a crucial role in the economies of ASEAN countries as a key driver of economic growth and development. It contributes to the fulfilment of the SGGs in different aspects including gender equity, creating decent work for everyone, poverty reduction and sustainable development for cities and communities. While the potential benefits of increased entrepreneurship are widely recognized, better evidence is needed to identify the most effective policies for entrepreneurship promotion in the region. From a gender viewpoint, some inclusive development policies are needed to ensure disadvantaged groups like women will not be excluded from this path. Starting a business venture may present different types of challenges which will also follow in the later stages of the entrepreneurial process. The very first step along a business career path can also be experienced by men and women differently. The existing literature still has not pinpointed quantitatively the factors which are essential in encouraging or limiting the entry of new enterprises within different local contexts. Our study attempts to fill this gap by looking at six ASEAN countries which are currently at different stages of economic development to find out the degree of disparity in intentional business start-ups among business-minded men and women. Besides the gender factor, we can also identify the importance of various other factors in determining the likelihood of a new business venture across six countries. Using survey data from the Global Entrepreneur Monitoring from 2013 as well as statistics across several years we found that, overall, women in ASEAN economies have a higher probability of intending to create business start-ups, other factors being equal. The difference of 4% is confirmed statistically in all our models. This significant disparity favouring women is observed clearly in the case of Indonesia and Thailand. This result comes as a surprise because it is not perfectly in line with the analysis of GEM reports indicating that five out of six ASEAN countries (Vietnam, the Philippines, Thailand, Singapore and Malaysia) women show equal or higher entrepreneurship rates than men. This finding can be explained by noting that GEM reports look at the total early-stage entrepreneurial activities (TEA) while our study is purely focused on potential entrepreneurs who have not yet operated their business. Another important highlight found in our study is related to education and business skills.
In general, education levels do not show strong correlations with the possibility of creating a business start-up, while the skills and knowledge that people perceive as having sufficiently are critical. Country cases also offer an interesting difference. In Vietnam and the Philippines (as factor-driven economies) for individuals with upper secondary school education, the chance that they will do their own business is lower than people without primary schooling. However, the opposite is the case in Malaysia, a country at a higher stage of development. Table 5.8 The national context for business start-ups in 6-ASEAN countries (2013) shows low indicators for post-school entrepreneurial education and training in Vietnam compared to other ASEAN countries. Education is also related to the cultural and social norms on career and entrepreneurship in different countries. Tables 5.8 The national context for business start-ups in 6-ASEAN countries (2013) and 5.9 Gender equality index in 6-ASEAN countries indicate those variations. The survey data we used in this study does not specify many variables for family support, which is an influential factor for women doing their own business. This is one of the important limitations of our study. However, the size and the income rank of households do have some significant effects on the decision of people to run their own business. The differences in these effects between the cases of Thailand and Indonesia again rely on social and cultural explanations. Lastly, the business-oriented social network, the perceptions and attitudes towards entrepreneurship have proved to be very important factors for people to embark on their venture creation. The National Expert Survey (NES) from GEM looks at the national context in which individuals start businesses, as shown in Table 5.9 Gender equality index in 6-ASEAN countries with high indicators for cultural and social norms for all six countries (over 3 out of 4).