Abstract
Entrepreneurs start and grow their ventures in a widely varying set of institutional contexts. One differentiator is a country’s regulatory efficiency which encompasses the freedom to start and to run a business without excessive government interventions around registering, hiring, and firing employees, and price controls on currency. The efficiency of regulations varies substantially among countries and imposes additional costs and risks on entrepreneurs’ activities. We integrate insights from institutional theory and recent literature on gender and entrepreneurship to better understand how a country’s regulatory efficiency affects male and female entrepreneurs’ employment growth ambitions. We explore three aspects of regulatory efficiency: business freedom (e.g., to start, operate, and close a venture), labor freedom (e.g., laws around minimum wage, layoffs, severance), and monetary freedom (e.g., price stability) using data from over 47,000 entrepreneurs in 68 countries. We find that entrepreneurs’ growth ambitions are higher in countries with more efficient regulations, particularly those countries characterized by fewer labor law restrictions and greater monetary freedoms. These findings are further exacerbated by gender by such that, relative to their female counterparts, male entrepreneurs have significantly greater venture growth ambitions. Our paper contributes to the discussion on how formal institutions influence women and men entrepreneurs in distinct ways.
Highlights
One of the world’s fastest growing entrepreneurial populations is women-led new and small businesses (Brush et al 2006; Brush and Cooper 2012) which number 274 million in 74 countries (Kelley et al 2017)
We explore the mechanisms of one-off versus recurring costs imposed by regulations (Baumol et al 2007; Darnihamedani et al 2018) on gender differences among entrepreneurs (Watson and Robinson 2003; Alsos et al 2006; Jennings and Brush 2013) that manifest in dissimilar impacts on employment growth ambitions of female versus male entrepreneurs
We argue that compared to women, regulatory efficiency is likely to positively influence male entrepreneurs’ employment growth ambitions, as males typically have characteristics and resources that are more activated by regulatory efficiency
Summary
One of the world’s fastest growing entrepreneurial populations is women-led new and small businesses (Brush et al 2006; Brush and Cooper 2012) which number 274 million in 74 countries (Kelley et al 2017). There is a critical gap in our knowledge around how formal institutions may lead to differences in growth ambitions between female and male entrepreneurs (Estrin and Mickiewicz 2011; Bradley and Klein 2016; Terjesen et al 2016; Welter et al 2017). Entrepreneurship research acknowledges the importance of regulatory efficiency to entrepreneurial activity, but has not explored gender differences (Estrin and Mickiewicz 2011; Goltz et al 2015). We integrate insights from institutional theory, firm growth, and gender entrepreneurship to explore how labor market institutions shape female and male entrepreneurs’ employment growth ambitions
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Free) 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a call
