Foreign Direct Investment and Female Entrepreneurship

36 Pages Posted: 24 Dec 2019

See all articles by Sheng Fang

Sheng Fang

World Bank - Development Research Group

Heba Shams

The World Bank

Lixin Colin Xu

Cheung Kong Graduate School of Business

Date Written: December 16, 2019

Abstract

Using World Bank Enterprise Survey data around the world, this paper examines how foreign direct investment is associated with female entrepreneurship (that is, a firm being managed and at least partly owned by women), along with other factors such as business environment and female empowerment, and their interactions with foreign direct investment. Female entrepreneurship rises with foreign direct investment inflow, lower entry barriers for women, women's better access to finance, higher female labor force participation, and women's better education. The positive association of foreign direct investment inflow and female entrepreneurship is stronger for firms in the service sectors and small firms. The horizontal competition effects of intra-industry foreign direct investment for female entrepreneurship are reduced when women face lower entry barriers for starting a business and have a higher labor force participation rate, and the effects do not depend on women's access to finance or their level of education.

Keywords: Private Sector Economics, Private Sector Development Law, Marketing, Labor Markets, Gender and Poverty, Technology Industry, Technology Innovation, Gender and Economic Policy, Economics and Gender, Gender and Economics, Gender and Development, Educational Sciences

Suggested Citation

Fang, Sheng and Shamseldin, Heba and Xu, Lixin Colin, Foreign Direct Investment and Female Entrepreneurship (December 16, 2019). World Bank Policy Research Working Paper No. 9083, Available at SSRN: https://ssrn.com/abstract=3507831

Sheng Fang

World Bank - Development Research Group

Washington, DC 20433
United States

Heba Shamseldin

The World Bank ( email )

1850 I St., NW, MSN I 9-900
Washington, DC 20433
United States

Lixin Colin Xu (Contact Author)

Cheung Kong Graduate School of Business ( email )

1017, Oriental Plaza 1
No.1 Dong Chang'an Street
Beijing
China

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