The Playing Field of Innovative Entrepreneurship: A Multilevel Analysis of Institutional Effects on Female Entrepreneurship

Abstract

The low level of female participation among entrepreneurs is usually attributed to the inequality of opportunities between males and females. Thus, female entrepreneurship is argued to increase on a level playing field. Assuming that a country’s institutional environment shapes the playing field for entrepreneurship, this study attempts to investigate the effect of the institutional framework on the rate of early-stage innovative entrepreneurship by women. We develop a framework that relates innovative entrepreneurship to gender through four institutional variables: (i) Government support for entrepreneurship, (ii) entrepreneurial finance, (iii) commercial infrastructure and (iv) support for female entrepreneurship. We test this framework by analyzing a large sample of survey data from 93 countries using the mixed-effect logistic regression. The regression results are largely consistent with the framework constructed. Overall, the findings underscore the importance of the institutional environment in creating a conducive entrepreneurial ecosystem, and in enhancing female participation in entrepreneurial activities.