What is it about?
Gender discrimination in small business credit is a controversial topic among researchers. Some researchers find gender discrimination exists, while others find the opposite. This paper explores whether female small business owners are discriminated against and what factors affect the amount of loan they receive. Although our results show there is no gender discrimination on loan amount provided, a closer look at specific groups (newer firms or less experienced owners) tells different stories.
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Why is it important?
Equal credit opportunity is an important topic among researchers and practitioners. Although many research studies examined the access to credit for female small business owners, which include loan approval or denial rates, loan application rates, or people who are discouraged to apply for a loan, there are limited studies on small business loan amount. Our study not only fills this gap, but it also explores different measures of Type 1 Credit Rationing and what types of female-owned firms are discriminated against.
Perspectives
Ideas of measuring Type 1 credit rationing in many different ways came from feedbacks from my colleagues, journal reviewers and conference audiences. By testing these measures, I became deeply aware of data, measurements and methodologies we used in different studies are the key for understanding who is discriminated and who is not. I hope this study shows why some female owners get smaller loans than men.
Dr. Naranchimeg Mijid
Charter Oak Financial
Read the Original
This page is a summary of: Gender differences in Type 1 credit rationing of small businesses in the US, Cogent Economics & Finance, March 2015, Taylor & Francis,
DOI: 10.1080/23322039.2015.1021553.
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