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Unequal Hard Times: The Influence of the Great Recession on Gender Bias in Entrepreneurial Investment

Sharkey, A

Amanda Sharkey, University of Chicago

Description

Semester:

  • Winter 2015

Speakers:

Amanda Sharkey, Organizations and Strategy, University of Chicago

Lecture Time:

Fri, April 10, 2015 @ 1:30 pm to 3:00 pm

Lecture Location:

Room R1240, Ross School of Business

Speaker Webpage(s):

http://www.chicagobooth.edu/faculty/directory/s/amanda-j-sharkey

Introduced By:

No introduction available.

Abstract

This article draws on an analysis of panel data from the Kaufman Firm Survey to investigate how
the Great Recession affected gender gaps in entrepreneurial access to financing, net of individual
and firm-level characteristics. We find that female-led firms were significantly more likely than
male-led firms to encounter difficulty in acquiring funding when the small-business lending
market contracted in 2009 and 2010. We assess the consistency of our results with three different
theories of bias or discrimination, concluding that our findings are most consistent with
predictions based on sociological and social psychological theories of gender bias. In particular,
our analyses show that the disparity in access to credit arose in part because female-led ventures
with low credit scores encountered a significantly larger penalty than did similar male-led
ventures during these years, a finding which indicates that the recession led to the application of
double standards that disadvantaged women. These findings shed light on the mechanisms that
generate a gender disadvantage for female entrepreneurs and, more broadly, highlight how the
relevance of ascribed status characteristics (e.g., gender) may vary systematically with
macroeconomic conditions.

Recording & Additional Notes

Introduced by Strategy PhD student Heewon Chae