Abstract
In this paper, we investigate if there is a link between female ownership and obstacles to firm growth. Using the World Bank Enterprise Survey (WBES) data collected in 2006 and 2010 for over 20,000 firms in 26 Latin American and the Caribbean (LAC) countries, we find strong evidence that female-owned firms (FOFs) are associated with more obstacles related to crime, theft and disorder, and to practices of competitors in the informal sector than male-owned firms (MOFs). However, FOFs and MOFs face similar levels of obstacles related to corruption and access to finance. We further examine the effect of female ownership on firm performance and find that FOFs exhibit significantly higher labor productivity than MOFs, while FOFs and MOFs experience similar sales growth. Our results are robust after controlling for relevant country-level macroeconomic and governance variables, as well as the potential endogeneity arisen from selection bias.
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