Lending to female-owned small enterprises in Sri Lanka and Ghana [1]

Chris Woodruff (Oxford University) finds that investments in small enterprises yield high returns at 6% per month. Interestingly, these returns are heterogeneous across genders; the male-owned enterprises see returns higher than 6% per month, while female-owned enterprises see average monthly returns of 0%. A similar study in Ghana finds comparable heterogeneous gender effects across firms. Chris argues that an explanation for this, supported by a growing body of research, could be that money loaned to females is often re-allocated within the household to the males.

Video: 
Standfirst: 
Investment in small firms led to monthly returns of 6% in Sri Lanka. However, the returns are negligible for female-owned enterprises.
Date Published: 
Monday, December 18, 2017
Tags: 
cash transfers [2]
self-employed [3]
enterprise [4]
SME [5]
small business [6]
return to capital [7]
investment [8]
female-owned [9]
microloans [10]
Authors: 
chrismwoodruff [11]
Cover Image: 
Topic: 
Firms & Trade [12]
Related content: 
Bad practices hold back small firms in developing countries [13]
Women’s empowerment and development: The family connection [14]
Manufacturing growth and the lives of Bangladeshi women [15]
Strengthening women’s professional aspirations through job training: Evidence from Nigeria [16]
Return to capital in small firms [17]
Photo Credit: 
Sandiooses